A lot of Americans think they have a handle on their investments and income. In fact, according to a â€National Financial Capability Study" commissioned by the Financial Industry Regulatory Authority Investor Education Foundation, 75 percent of Americans say they’re good at dealing with day-to-day financial matters and family investments. Family investing is possibly one of the most important things a family faces when it comes to their future. However, only about 55 percent (a fail on a typical grading scale) got correct answers on 5 basic questions that were on the study that focused on their family investments. Can you get them right? Let’s see†1)Suppose you have $100 in a savings account earning 2 percent interest a year. After five years, would you have more than $102, exactly $102, or less than $102? 2)Imagine that the interest rate on your savings account is 1 percent a year and inflation is 2 percent a year. After one year, would the money in the account buy more than it does today, exactly the same or less than today? 3) If interest rates rise, what will typically happen to bond prices? Rise, fall, stay the same, or is there no relationship? 4)True or false: A 15-year mortgage typically requires higher monthly payments than a 30-year mortgage but the total interest over the life will be less. 5)True or false: Buying a single company's stock usually provides a safer return than a stock mutual fund. Not as easy as you might think? Family investment rarely is. Or possibly just as easy as you thought and you want us to tell you that you got them right? Well, the answers are as follows, along with the percentage of people who got them right. 1)More than $102, 65 percent 2)Less than today, 64 percent 3)Fall, 21 percent 4)True, 70 percent 5)False, 52 percent Family investment issues are a huge problem with today’s average American family because, according to the survey, people don’t know how to handle the four basic components of financial capabilities; making ends meet, planning ahead, managing financial products, and financial knowledge and decision-making. The survey was given to 1,488 Americans over the age of 18 and was developed with the U.S. Department of the Treasury and the President's Advisory Council on Financial Literacy. Possible Pictures: â€http://www.istockphoto.com/file_thumbview_approve/7201516/2/istockphoto_7201516-coin-count.jpg â€http://www.istockphoto.com/file_thumbview_approve/4760412/2/istockphoto_4760412-sunny-day-at-home.jpg â€http://www.istockphoto.com/file_thumbview_approve/8525391/2/istockphoto_8525391-credit-crunch-stress.jpg Log on :http://www.familyfinancesource.com for further information.
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