American Teens Failed a Financial Literacy Test, I Took the Test and I Failed Too

The press release I received in my inbox would have you believe that the youths are failing at financial literacy. However, the results of the study may be flawed, and I am not saying that just because I failed the test (although my ego was bruised)

Annual Test Report

According to the results of an annual test reported by the National Financial Educators Council (NFEC), levels of financial literacy among American youth and young adults remain low.

The NFEC has been gathering financial literacy data across all 50 states since 2014, with more than 150,000 people participating in the quizzes to date. The most recent findings, from January 2023, indicate that 52% of the 45,916 participants aged 15 to 18 were unable to pass the NFEC’s National Financial Literacy Test with a score of 70 or better.

For example, the Financial Foundation Test: This brief 8-question quiz measures capability to make basic-level financial decisions. Among a total 9131 respondents aged 15-18, the average score was 57.81% and 62.8% failed to reach 70% or higher.

I Took the Test

I went and took the test. I scored a 62.5% which is pretty embarrassing.

I might get slammed for this, but I am not sure the questions or answers are exactly indicative of financial literacy in the United States.

One of the questions that I got wrong was about car loans.

Question: The best time to shop for a car loan is…

The answer I chose: It’s always best to pay cash for your car.

The correct answer: Before you start searching for a car.

Their answer is not wrong. It’s correct. My answer is also correct. In fact, both are correct.

Another question: “If you are unable to pay off the entire balance you owe in credit card debt, the best way to pay off the balance is to _____.”

I answered this one correctly: “Pay the maximum your budget allows on the card with the highest interest rate.”

However, another option was, “Pay the maximum payment on the card with the highest balance” or “Pay off the card with the lowest balance first.”

Are those wrong answers?

Dave Ramsey, one of the most influential and widely-followed personal finance gurus, would say, “Pay off the card with the lowest balance first” is the correct way to tackle credit card debt.

Personal Finance Is Personal

I fully believe that we need to increase financial literacy for our children; however, tests like these and headlines like these don’t do us any favors.

Should someone take out a car loan? Maybe. Maybe not. Personal finance is, by definition, Personal.

We should remember that.

Basic Finacial Literacy

Basic financial literacy is a key component of any education. Teaching children and teens about loans, credit cards, money, and budgeting is crucial. However, basics and foundations should be just that, basics and foundations.

Why are we telling teens that the best way to buy a car is with a car loan? Why is that the “correct answer”? Is that “financial basics”? I question these scores and what they mean for our teens.

Maybe we should question the way we measure financial literacy.


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This article was produced and syndicated by A Dime Saved.


Hi! I am a millennial mom with a passion for personal finance. I have always been “into” personal finance but got inspired to start my blog after a period of extended unemployment. That experience really changed the way I viewed my relationship with money and the importance of accessible personal finance education.