Debtwave Financial Education Test

DebtWave Education Program Test

Name:*
Client ID:*
Phone:*
E-mail:*
1. Define what wealth means to you.*
2. Choose the correct formula for calculating your net worth:*
- A. Assets minus liabilities = net worth
- B. Assets multiplied by liabilities = net worth
- C. Assets plus liabilities = net worth
- D. Assets divided by liabilities = net worth
3. List three of your assets (or examples of assets if you don't have three).*
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*
4. List three of your liabilities (or examples of liabilities if you don't have three).*
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*
5. My short-term financial goals are:*
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*
6. My long-term financial goals are:*
*
*
7. When setting a savings goal you should always set the goal high so you can get rich as quick as possible.*
- A. True
- B. False
8. When you receive a raise at your job, you should try to:*
- A. Use that money towards credit card payments
- B. Pretend it doesn’t exist and have it go to savings or investment account
- C. Use it for an extra night out
- D. Take it to Vegas
- E. Both A and B
9. A basic emergency fund should consist of:*
- A. Dependence on a rich friend or family member
- B. Having a high limit credit card
- C. Having $1,000 in a standard savings account
- D. Establishing an account with a local pay day loan company
10. What percentage of your take home income is recommended to be deposited into an interest-bearing savings account each paycheck?*
- A. 0 percent
- B. 5 percent
- C. 10 percent
- D. 6 percent
11. A budget allows you to do all of the following except:*
- A. Ensure you don’t spend more than you make
- B. Understand where your money goes
- C. Find uses for your money that will increase your wealth
- D. Spend more than you bring in
12. Which of these steps do you need when creating a budget?*
- A. Determine how much you spend on monthly recurring expenditures
- B. Calculate your monthly income before and after taxes (retirement and health insurance, if applicable)
- C. Determine how much you spend day-to-day by tracking your daily expenses
- D. All of the above
13. List three expenses that you could cut back on or eliminate.*
*
*
14. Your gross income is defined as earnings after taxes and deductions.*
- A. True
- B. False
15. Keeping track of your daily expenses helps you:*
- A. Increase your credit card spending
- B. Increase your income
- C. Become motivated to make changes to your spending habits
- D. Go shopping more often
16. All of the following are cons of using credit cards except:*
- A. Potential for overspending
- B. Terms and conditions of contracts are difficult to comprehend
- C. Can help build credit history
- D. Target for scams and fraud
17. The formula for calculating your approximate yearly finance charges is:*
- A. Total debt divided by monthly payment
- B. Monthly payment divided by APR
- C. Monthly payment divided by total debt
- D. Total debt multiplied by APR
18. The formula for calculating your approximate monthly finance charge is:*
- A. Yearly finance charge divided by monthly payment
- B. Yearly finance charge divided by 12
- C. APR multiplied by 12
- D. Monthly payment multiplied by APR
19. The yearly finance charge for a balance of $12,721 with a 6.99 percent interest rate is:*
- A. $1,027.38
- B. $889.20
- C. $732.99
- D. $1,162.26
20. What is the monthly finance charge of a balance of $25,442 at a 28.99 percent interest rate?*
- A. $532.21
- B. $389.64
- C. $614.64
- D. $708.07
21. The minimum payment that credit card companies typically require each month is:*
- A. 4 to 5 percent of the balance
- B. 3 to 4 percent of the APR
- C. 2 to 3 percent of the balance
- D. 2 to 3 percent of the yearly finance charges
22. Making a fixed payment that is greater than the minimum payment toward credit card debt is a wise decision because it will help pay off the balances more quickly than making the minimum payment every month.*
- A. True
- B. False
23. All of the following will help you get out of debt except:*
- A. Getting organized
- B. Continuing to use credit cards on a monthly basis
- C. Paying more than the minimum payments
- D. Lowering your interest rates
24. When making a list of all of your unsecured debt you want to include the following except:*
- A. Balance
- B. APR
- C. Name of creditor
- D. Address of creditor
- E. Current payment
25. It is wise to pay for credit card insurance.*
- A. True
- B. False
26. Why is it never a good idea to borrow or withdraw against your 401(k)?*
27. List three traits of a predatory lender.*
*
*
28. For a 30-year, fixed-rate mortgage what would the monthly payment be for a $140,000 loan at a 5 percent interest rate?*
- A. $532
- B. $823
- C. $752
- D. $899
29. What is the difference in the monthly payment between 4 and 14 percent interest in a $150,000 loan?*
- A. $1,060
- B. $928
- C. $1,103
- D. None of the above
30. List four ways to ensure you get the best loan possible for you.*
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*
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32. Credit reports have information regarding race, religion, medical history, political preferences, criminal record and other information unrelated to credit.*
- A. True
- B. False
33. List the four types of information that appear on your credit report.*
*
*
34. All these types of credit are reported on a monthly basis to the credit reporting bureaus except:*
- A. Car payment
- B. Rent
- C. Student loan
- D. Credit card(s)
35. What is a credit score?*
36. What is the range of FICO scores?*
- A. 300 - 850
- B. 300 - 800
- C. 500 - 900
- D. 400 - 950
37. Payment history accounts for what percentage of your FICO score?*
- A. 10%
- B. 15%
- C. 30%
- D. 35%
38. Debt-to-credit ratio accounts for what percentage of your FICO score?*
- A. 10%
- B. 15%
- C. 30%
- D. 35%
39. What are the four Money Avoidance Disorders?*
- A. Hoarding, overspending, financial infidelity, financial incest
- B. Financial denial, financial rejection, underspending, excessive risk aversion
- C. Workaholism, financial enabling, underspending, hoarding
- D. Financial rejection, compulsive buying disorder, unreasonable risk taking, workaholism
40. Sherry was the beneficiary of over $100,000 when her father passed away. Within two weeks, she spent all of the money. Which money disorder does Sherry demonstrate?*
- A. Financial incest
- B. Financial enabling
- C. Workaholism
- D. Financial rejection
41. Money Worshipping Disorders place a disproportionate amount of importance on money: earning it, saving it and spending it. What do people with these disorders typically believe?*
42. Which of these is not a Relational Money Disorder?*
- A. Financial incest
- B. Financial infidelity
- C. Financial gains
- D. Financial dependency
- E. Financial enabling
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Debtwave Financial Education Test

DebtWave Education Program Test