Master Your Money: A Quiz to Test Your Financial Literacy

Citizens State Bank is proud to celebrate Financial Literacy Awareness Month this April by inviting you to participate in our Financial Literacy Quiz! We believe in empowering our community with the knowledge and tools necessary for financial wellness. Our quiz is designed to test your understanding of basic financial concepts, including saving, investing, budgeting, and credit management. Whether you’re a financial novice or a savvy saver, this quiz is a great opportunity to assess your financial knowledge and learn valuable insights. Join us in our commitment to financial education and take the first step towards mastering your finances. Let’s make financial literacy a priority for everyone this month!

Financial Literacy Quiz

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What debts can't you erase with bankruptcy?

Any debt can be discharged. Bankruptcy is a get out of jail free card.

Big-ticket items like TVs or cars.

Student loans, child support, alimony, and legal judgments.

Payday loans and short-term loans.

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What costs should you consider besides the home's price?

Gas to get to work

Closing costs, taxes, insurance, and upkeep.

Furniture and paint

Just the home's price.

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What's a healthy debt-to-income ratio to keep things stable?

Not more than half your income (50%).

More income than debt is good.

It's best to keep it below 41%.

Try not to go over 27%.

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What should be part of your budget?

Only for life’s surprises.

Most people do not need a budget.

Every type of expense, including small daily purchases.

Only major expenses like rent and car payments.

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What does 'amortization' mean for a mortgage?

How much your payment will increase each year.

It’s how your payments are spread over time.

An extra service fee when buying a home.

The process of transferring the loan.

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What is the debt snowball method?

Paying off the largest debt first

Paying off the smallest debt first to gain momentum

Ignoring all debts until they are written off

Paying off the debt with the highest interest rate first

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What is a zero-based budget?

Budgeting with zero knowledge about your expenses

Spending all your income by the end of the month

Saving all your income and not spending any

Allocating every dollar of income to specific expenses, savings, and debt repayments

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What does APR really mean?

Applied Percentage Rate

Annual Penalty Rate

Annual Percentage Rate

Always Party Responsibly

9 / 22

Who calculates your credit score?

Visa, MasterCard, AMEX

Disney, Apple, Amazon

Experian, Equifax, TransUnion

Wells Fargo, TD Bank, Bank of America

10 / 22

Inflation affects your buying power by:

Doubling it every year

Decreasing it as prices rise

Not affecting it at all

Increasing it when prices drop

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What portion of your income should go to a car payment?

Half your income.

The same as your housing costs.

Between 10-15%

As long as you can make the payment.

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How often can you check your credit report without paying?

Twice a year

Once a year

It's never free

As many times as you want

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How does compound interest differ from simple interest?

There is no difference, both are the same.

Simple interest is calculated daily, while compound interest is calculated annually.

Compound interest is interest on interest, while simple interest is only on the principal amount.

Compound interest is for loans, and simple interest is for savings accounts.

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Which of the following is a characteristic of a SMART financial goal?

Time-bound

Unattainable

Unmeasurable

Vague

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What's a good strategy for your personal budget?

When you feel like it.

Saving a consistent percentage of your income.

Whenever you have a few bucks extra.

Always save something, even if you spend first.

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What is the recommended down payment on a standard home loan?

20% of the home's price

$20,000

About 5% of the loan’s total amount

Whatever you can gather quickly

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How much of your paycheck should you try to save each month?

o Aim for 10% - it's a good balance.

o About 2% - every little bit helps!

o Whatever you can after paying bills - even if it's just some loose change.

o Any spare cash - but make sure to pay your bills first!

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How do you figure out your net worth?

Subtract your debts from your income.

Add up what you own and subtract what you owe.

Multiplying your credit score with your income.

Divide your income by you debts.

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What is a key benefit of having a written financial plan?

It outlines steps to achieve your financial goals

It increases your expenses

It is only useful for wealthy individuals

It guarantees financial success

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Which of the following is a recommended strategy for building an emergency fund?

Borrowing money when emergencies arise

Using credit cards for emergencies

Investing in high-risk stocks and cash out when you need the money

Putting aside 3-6 months' worth of living expenses in a savings account

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What does 'liquidity' mean?

How fast you can turn assets into cash.

The amount of cash a person has on hand.

The value of your stock portfolio.

How easily a person can pay off debts.

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What makes up your credit score?

A good attitude and a pinky promises.

Your payment history, how much of your credit you use, new credit, how long you've had credit, and the types of credit you have.

Your income, number of credit cards, how timely you pay, penalties, and how much you save.

How much you owe, your interest rates, number of credit cards, late payments, and overcharges.

Your score is

The average score is 65%

Connect with Citizens State Bank Today for Personalized Guidance and Support.

Citizens State Bank is dedicated to enhancing your financial health and knowledge, not just during Financial Literacy Awareness Month, but all year round. If you’re inspired to take control of your financial future, have any questions, or are ready to take the next step towards financial wellness, we encourage you to reach out to us. Our team is here to provide you with personalized support, resources, and guidance to help you navigate the complexities of financial planning, saving, investing, and credit management. Let’s work together to achieve your financial goals and make informed decisions that lead to a secure and prosperous future.