Test Your Money Smarts

Click here to find out if you are money smart.

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1) Which activity can pose the greatest threat to your wallet?

Getting a latte at Starbucks every day
Taking out student loans to pay for college
Spending without a plan

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Spending without a plan can put you in a world of hurt. Not correctly managing your finances can cause you to overdraw your accounts, go over your credit limit, and rack up excessive amounts of debt.

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2) If you apply for a store credit card, how do they decide if they approve you—or turn you down—on the spot?

They make sure you look good in their clothes
They check out your credit score
They make sure you have spent a set amount of money at their store

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Many stores are set up to access your credit score right at the register. If you have a high score, you are usually given a credit line right on the spot. If you have a low score, you will be denied a credit line.

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3) What is a good credit score?

450
600
740

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740 is considered an exceptional credit score. The national average score is 680.

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4) What does a phisher want?

Your personal and financial information
A romantic date
Your academic records

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Phishers are email scam artists who want to steal your confidential personal information. They use the information to make purchases or borrow money in your name, or access your bank account.

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5) If someone steals your credit card and uses it, how much could you end up owing?

$50
$500
The total bill

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The Truth in Lending law limits your liability to $50 if your credit card is stolen. On the other hand, you could owe $500 if thieves get their hands on your debit card.

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6) Can you get financial aid for studying abroad?

No, you can't use any financial aid for study abroad
You can use private scholarships but not state or federal loans or grants
Yes, you can use all types of financial aid for study abroad

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If the program meets certain requirements, you can use any type of public or private financial aid, including loans, grants, and scholarships to pay for study abroad.

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7) When do you have to start repaying your student loans?

The day after you graduate
6 months after graduation
When you find a job

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You have six months from graduation until you must start paying back your student loans. If you are having a hard time finding a job, you may qualify for payment relief. You can contact your lender for more details.

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8) How much money should you keep in your emergency fund?

3% of your current salary
The equivalent of 3 months' living expenses
Nothing—just use your credit card in case of emergencies

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As soon as you start pulling in a paycheck, one of your priorities should be saving at least 3 months' living expenses for emergencies.

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9) How can you tell if your identity has been stolen?

You receive bills for things you never purchased
You receive lots of spam email
You receive mail addressed to someone else

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Receiving bills or statements for things you never purchased or credit cards for which you never applied may be a sign of identity theft.

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10) If you're trying to build good credit, what is the most important thing you can do?

Throw away your credit cards and don’t take out any loans
Maintain a balance on your credit cards and pay the minimum every month
Pay your bills on time

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Paying your bills on time, including your rent, student loans, and credit cards, is the single most important thing you can do to establish good credit.

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11) Your credit score can affect your ability to:

Lease an apartment
Get a good rate on auto insurance
Both of the above

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Your credit score can affect your ability to get a loan, an apartment, or even a job. It can also affect the interest rate you pay to borrow or the premiums you pay for insurance.

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12) What's the main difference between debit cards and credit cards?

Debit cards have a higher interest rate than credit cards
Debit cards work like a check while credit cards work like a loan
They're really the same thing

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When you use a debit card, the money comes directly out of your bank account. A purchase you make on a credit card is a loan on which you'll pay interest if you don't pay your bill in full and on time.

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13) What's the best way to buy a flat-screen TV?

Buy it on a rent-to-own plan
Buy it on a credit card and pay it off over time
Buy it on a credit card and pay in full when the bill comes due

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Using a credit card and paying your bill in full when it comes due will help you establish good credit. You may also be able to take advantage of the free extended warranty on electronics that some credit cards offer.

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14) When can you start putting money into a retirement account?

When you turn 21
When you begin earning income
When you get married

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From the time you start earning income—whether from waiting tables or working at the Rec—you can begin putting your money into an individual retirement account, or IRA. The sooner you start investing, the bigger your savings can grow.

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15) Why could it be risky to lend your car to a friend?

You may not be covered if your friend has an accident
You will lose money on gas
She’ll look cooler in your car than you do

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Sure it's expensive and inconvenient to lend out your car—but it's also risky. Your insurance may only cover you driving the vehicle. If that's the case, you may not be covered if your friend has an accident.

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16) What are your odds of winning a six-number lottery?

1 in a million
1 in 5 million
1 in 10 million

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Your odds of winning the lottery are so low that many mathematicians call the lottery a tax for people who are bad a math.

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17) What happens if you sign a year-long lease for an apartment and then have to move out after 6 months?

You lose your security deposit
You may have to pay the rent for the time remaining on the lease
You can just cancel the lease

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Whether you're still living in the apartment or have moved out, you're still obligated to pay rent through the end of the lease.

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18) Why is it smart to carry your N card with you at all times?

You can use it to get discounts
The campus police will want to see it
You can use it instead of a government ID

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Your student ID entitles you to many discounts—from discounts on lunch and to movie and theater tickets. Be sure to ask, since some discounts may not be advertised.

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19) Is it important to consider health insurance benefits when evaluating a job offer?

Yes, health insurance is important at any age
No, I’m young and healthy and have nothing to worry about
Only if you have a chronic illness or disability

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Whatever your age or health status, health insurance is important. It's a valuable benefit, often equivalent to thousands of dollars in salary. You will want to figure it in when comparing job offers.

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20) What can happen if you fill out your W4 incorrectly?

The IRS will hunt you down
You can end up withholding too much or prepaying too little federal tax
Nothing, your tax accountant can figure it out

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If you fill out your W4 incorrectly, you could end up having too little, or too much, tax withheld. Too little, and you’ll owe money when you file your taxes. Too much, and you've given the IRS an interest-free loan with money that could have been earning you money in an investment account.

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FINAL RESULTS

0-10 Correct

You need to expand your knowledge of financial matters.

Learn more about financial success by scheduling a money management advising appointment at the UNL Student Money Management Center.

FINAL RESULTS

10-17 Correct

You are starting on the path to financial success, but you lack some important financial knowledge.

Learn more about financial success by scheduling a money management advising appointment at the UNL Student Money Management Center.

FINAL RESULTS

17-20 Correct

Congratulations! You are on the path to financial success.

Learn more about financial success by scheduling a money management advising appointment at the UNL Student Money Management Center.