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Why Johnny Has Bad Credit

A recent test found teenagers' financial knowledge to be lacking. Is yours any better? Take the test.


is everywhere, and

Maria Bartiromo

even has her face in



But teenagers still don't know the difference between debt and donuts.

Sure, investing has evolved into something for the masses. A decade ago, you had to call your broker to get an intraday stock quote. Now you can get free real-time quotes online. Ten years back, Internet trading didn't exist. Today an online brokerage account is a status symbol.

Alas, teenagers seem to know even less about personal finance today than just a few years ago.

A recent survey, sponsored by the

Jump$tart Coalition for Personal Financial Literacy

in Washington, quizzed 723 high school seniors in U.S. public schools about some basics of personal finance. The survey covers issues related to spending, borrowing, credit and simple investing principles.

The results were not promising.

On average, participants answered only 51.9% of the 30 questions correctly, down from 57.3% for a similar survey conducted in 1997. Nonetheless, more than 30% of these kids use credit cards (either their own or their parents'). Ironically, the students who own credit cards scored worse than teenagers who don't even use them.

"I was extremely dismayed by the results," says Dara Duguay, executive director of the nonprofit organization.

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"The market has evolved into a very complex place," says Duguay. And kids aren't being educated about these crucial basics.

For example, only 23.4% of the teenagers surveyed knew that stocks have greater long-term growth potential than a savings account or a government savings bond.

Some of the questions weren't that easy.

Could this test stump you?

Find out for yourself.

I've assembled all 30 questions in the form of a poll. It will take just a few minutes to take the test. Click

here to start.

You can click on the "See Results" link at the bottom of the test to find out how


readers, as a whole, are answering each question. Tomorrow, I'll provide the correct answers so you can tabulate your own scores.


readers should do well, right?

Most of you are adults, after all.

Send your questions and comments to, and please include your full name.

Dear Dagen aims to provide general fund information. Under no circumstances does the information in this column represent a recommendation to buy or sell funds or other securities.