Recent survey around the world has shown that most high school students may not be prepared to handle their own personal finances. They are lacking the knowledge that is needed to manage money. A test called Programme for International Student Assessment included the survey on a teenager’s financial knowledge. Along with survey were tests on core subjects, like reading, science, and mathematics. Every three years, the test is conducted, measuring the abilities of students that are 15 years of age. 

For the first time, the most recent survey included financial literacy questions. The scores of U.S. students compared to their peers from 17 different countries and economies were about average. The experts of financial literacy felt that the scores were less than ideal. Some of the other countries included New Zealand, Australia, Shanghai, Russia, and France.  With the U.S. having one of the most advanced financial markets, the average score is not viewed as a good standard. 

Throughout all of the countries, about 10% of those tested could answer the more difficult questions related to money correctly. An additional 15% of the students had a score at the lowest level or below. Each of the questions had a difficulty range of 1 to 5, with 5 being the highest level. An example of a Level 5 question involved comparing two loans and explaining the gain for choosing the latter of the two:

$8,000 has 15% interest

$10,000 has 13% interest

The correct answer should have been that the latter option had a lower interest rate and more money available. 

The easier questions involved general topics, such as having the student identifying the purpose of an invoice. It will come as no surprise for most people that a teen is befuddled by questions pertaining to loans. Majority of the 15-year old teens have never or have had little experience in borrowing money. At the same time, these student will soon be forced to make some major financial decisions in their life. One of the first being going to college and continuing their education.