WorksheetsFinancial Literacy Test Review
Total questions: 50
Worksheet time: 50mins
Which type of bank account typically offers the least (if any) interest?
checking account
savings account
money market account
certificate of deposit
A savings account that compounds interest daily will earn a higher return than a savings account that pays simple interest daily.
True
False
Why is it important to reconcile your bank statements?
To avoid spending more than what is in your account
To detect any errors in your account
To determine if you were charged any fees
All of the Above
Which of the following statements about savings accounts is FALSE?
Savings accounts pay interest on the money you deposit.
Savings accounts may require you to maintain a minimum balance to avoid a fee.
Savings accounts are best used to store money for longer-term goals.
Savings accounts allow an unlimited amount of withdrawals each month.
If there is an issue with your bank statement or account balance, who should you contact to resolve the issue?
The local police
Your bank
The CFPB
All of the Above
investing is best for
short-term financial goals, like building an emergency fund
earning a little interest while keeping your money safe
long-term financial goals, like paying for retirement
guaranteed fast growth on your money
A ______ is a share of ownership in a company.
bond
stock
mutual fund
money market account
Which of the following should NOT be considered when setting a current budget?
Your financial goals
Future income
Needs and wants
Savings
In addition to needs, what should you plan for first when creating a budget?
possible charitable contributions
shopping money
investments
recurring expenses
Which of the following is NOT a good way to track your spending?
In your head
Notebook and pencil
envelop method
online software or app
This helps you prepare for unexpected expenses.
credit cards
checking account
emergency fund
none of the above
Making a good purchasing decision requires
comparing the prices of similar items
reading reviews of the product
waiting until the product is on sale, if possible
all of the above
When setting a budget, you can choose to make room for
financial goals
entertainment expenses
charitable donations
all of the above
Which payment option could have interest charged to you?
cash
check
debit card
credit card
When making a large purchase, you should avoid everything EXCEPT
excessive fees
being forced to buy additional warranties
add-ons that seem too good to be true
a price that fits comfortably in your budget
Which method of payment actually is a form of borrowing money that needs to be paid back later?
cash
credit card
debit card
check
Using a loan could help with the purchase of which of the following?
a new television
a dream wedding
a house
airline tickets to your dream vacation
What is a benefit of having a good credit score?
Loan sharks will be less likely to bother you.
You'll get accepted to better educational institutions.
You'll get more job offers.
When you need a loan, you'll have more loan offers to pick from.
Which of the following will help you protect yourself from identity theft and fraud?
Regularly monitor your credit report.
Contact lenders and credit bureaus to address incorrect information.
Freeze your credit.
All of the above.
Paying only the minimum balance on your credit card can lead to
an increase in your credit score
paying more interest
late fees
all of the above
Which option will NOT be available if you are behind on loan payments?
You could make a payment.
You can ask to get out of your loan.
You could borrow money from friends and family to pay your debt.
None of the above
Credit cards can help _____ when paid off on time regularly.
build credit history
act as a form of identification
lower your debt
balance your checking account
Which is not an example of a risk management strategy?
wearing reflective clothing while biking at night
buying a new car
wearing a helmet while biking
wearing a seat belt while driving
When filing an insurance claim, the policyholder must pay a ______, which is the amount you owe before insurance will cover the rest of the bill.
deductible
premium
contract fee
commission
An insurance premium is
the amount of money you pay for an insurance policy
the amount of money you pay for an accident
a commission paid to the agency for the purchase of a policy
an extra fee you need to pay
An insurance premium is paid by the
insurance company
claims adjuster
government
policyholder
A deductible is paid by the
insurance company
policyholder
claims adjuster
government
What does liability insurance NOT cover in the event of an accident?
damage to someone else's car
damage to someone else's property
injury to yourself
injury to the other driver
Insurance that covers damage to your car from an accident is called
collision insurance
liability insurance
comprehensive insurance
uninsured motorist insurance
When is it ok not to have health insurance?
If you are young and healthy.
You should always have health insurance.
If you do not have a full time job.
If you are a student under the age of 26.
What is a consequence of not having health insurance?
You must pay all costs for health care and medical emergencies.
You're not allowed to go to the hospital.
You will get a lower standard of care from doctors.
You can only see doctors in your home state.
The amount of money you're paid, after all taxes and deductions are taken out of your paycheck is called
gross pay
net pay
total pay
year-to-date pay
Which of the following is NOT a possible tax or deduction that could show up on your paycheck?
state income tax
contributions to retirement savings
FICA
sales tax
What is the purpose of the W-4 form?
To file your tax return.
To determine how much your gross pay should be.
To inform your employer of how much federal income tax to withhold from your paycheck.
To avoid paying income tax.
You employer sends you a ______ form that tells you how much you've made and how much you've paid in taxes the last year.
1040
W-2
W-4
W-9
Which of the following statements is true about taxes?
Taxes pay for schools and government departments.
Taxes pay for roads and emergency services.
Taxes are often used at the federal, state, and local levels.
All of the above.
What do you NOT need in order to fill out your 1040?
Your W-2
Your routing and bank account number
A record of any other supplemental income
Your employer benefits documentation
What do you need in order to fill out your 1040?
Your W-2
Your employer benefits statement
Your credit card statement
Your job offer
When considering a job offer, you should only consider how much you're being paid before you accept the offer.
True
False
Healthcare, paid time off, disability insurance, and matching contributions to a retirement account are all types of ______ available from your employer.
benefits
pensions
deductions
allowances
Andrew doesn't want to spend a lot of money on student loans, and does not qualify for grants. What is his best option for affording a Bachelor's Degree?
He can enroll in a trade school and transfer his courses later.
He can attend a specialized training program and transfer a couple of his courses.
He can attend the local community college whose courses transfer to the public four-year college.
None of these are correct.
Which of the following is true about the Free Application for Federal Student Aid (FAFSA)?
The earliest you can submit your FAFSA is October 1st of each year.
The form is available online.
States may have different deadlines for applying for state aid.
All of the above.
Which of the following answers lists 4 year colleges from generally the least expensive to most expensive?
In-state public university, private university, out-of-state university
In-state public university, out-of-state public university, private university
Private university, in-state public university, out-of-state public university
Out-of-state public university, private university, in-state public university
What type of federal funding is free money, but is based on financial need only?
Federal grants
All federal scholarships
The 529 plan
none of these are correct
Jane is a high school senior. She wants to go to the local community college and become a nurse. Her grades are average, but she comes from a low-income family. What could she do in order to afford the next step in her dream to become a nurse?
Jane has to wait until she saves up enough money to pay for tuition.
Jane could apply for federal grants to help her pay for college.
Jane can apply for need-based scholarships.
Jane should apply for federal grants and for need-based scholarships.
Which of the following is NOT a reason to complete the Free Application for Federal Student Aid (FAFSA)?
It allows you to be eligible for early admission.
It allows you to be eligible for federal student aid.
It allows you to be eligible for some grants.
It allows you to be eligible for many scholarships.
A mutual fund is _____.
A type of debt investment that acts like a loan.
A share of ownership in a company.
A type of investment that invests in a mix of different types of investments.
A type of savings account that pays interest based on current interest rates in the market.
Which of the following should you consider when setting a budget?
your financial goals
needs and wants
savings
all of the above
Where should you look to find your current expenses when building your budget?
ask your parents
your wallet
bank and credit statements
your bank representative
Which housing option gives you more freedom and more responsibility?
leasing a house
borrowing a house
buying a house
housesitting
