Many young people never learn money basics. Less than half of U.S. states require high school students to take a personal finance class before they graduate, for example.
And results on surveys and retirement IQ tests show a lack of financial literacy.
If you were able to set aside $50 each month for retirement, how much would that end up becoming 25 years from now, including interest, if it grew at the historical stock market average?
A. About $15,000
B. About $30,000
C. About $40,000
D. About $60,000
E. More than $60,000
The correct answer is C: about $40,000, assuming a 7 percent rate of return. Only 16 percent of the 2,000 respondents answered correctly.