My Money Smart Challenge

I have completed the first three modules of FDIC's Money Smart financial literacy curriculum! Honestly, I thought these courses would be informative yet easy. I was highly mistaken. At the beginning of each module I was asked a series of questions to test my knowledge. I never passed a pre-test. Here are some I missed:

Which of the following is an example of a secured loan?
a. Home loans and home equity loans
b. Most credit cards

c. Personal loans
d. Student loans

In which two of the situations below would you need to see the customer service representative at a bank?
a. Refer you to a person who can help you
b. Deposit your money for you
c. Take applications for loans offered at the bank
d. Answer general questions

Which of the following must be included in the Truth in Lending Disclosure? Select all that apply
a. Amount financed
b. APR
c. Finance charge
d. Total payments

Did you think you knew the answers? You better recheck! The first one is a, second is a and d, and the third is a, b, c, and d.

Here are some major benefits from just the first three modules of FDIC's Money Smart curriculum I'd like to share with you. 

1. Choosing the right financial institution for your specific needs will save you much frustration. For example, when I moved out of my parent's home to attend a university I never thought about changing banks. However, without the joint support of my parents as well as my student level income I was charged numerous bank fees. I could have easily avoided those fees by simply doing a little research and choosing the best checking account for me.

2. Its good to know how much your financial institution is insured. Insured institutions are guaranteed by the FDIC (Federal Deposit Insurance Corporation). So, if the institution fails the FDIC would return your money, up to the insured amount. To calculate the insurance coverage of your accounts go to FDIC's Electronic Deposit Insurance Estimator at www.myfdicinsurance.gov/  

3. Financial institutions may share your information with other companies to offer you other products and services. Federal privacy laws give you the right to opt out of some sharing of your personal financial information. To learn how to opt out go to www.optoutprescreen.com 

Financial literacy is the first step out of asset poverty. See my previous blog for more information on what exactly is asset poverty at http://newcenturyida.blogspot.com/2013/11/my-asset-poverty-status.html. Our New Century IDA program uses  FDIC's Money Smart for partnering Crosby Scholars participants. Info on Crosby Scholars programs can be found at http://crosbyscholoras.org/ , to participate contact EISR’s Barbara Johnson at barbara.johnson@eisr.org 

Be on the lookout for the next blog on my Money Smart Challenge progress!