Most 20-Year-Olds Can’t Answer Three Very Basic Questions About Finance Because Millennials Are Dumb



Fun fact: April is financial literacy month! Knowing that, get ready to weep for America’s economic future in the hands of the millennial generation.

A very scary study out of San Diego State University has discovered that most 20-year-olds are idiots. According to TIME’s summary of the study, the average participant could only answer 1.8 out of three very basic personal finance questions correctly. TIME says only a quarter answered all three correctly.

The questions are as follows, according TIME:

(1) Do you think that the following statement is true or false? Buying a single company stock usually provides a safer return than a stock mutual fund.

(2) Suppose you had $100 in a savings account and the interest rate was 2% per year. After 5 years, how much do you think you would have in the account if you left the money to grow: More than $102, exactly $102, or less than $102?

(3) Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. After 1 year, would you be able to buy more than, exactly the same as, or less than today with the money in this account?

Scroll down for the answers, in case you are a dumb-as-rocks millennial…



1: False. 2: More than $102. 3. Less than today.

Like, no offense, but you’re an idiot if you got any of those wrong.

This is like… 6th grade finance. When I was in 6th grade, a vice president of a local bank came into my algebra class and talked about all of the things mentioned in this study. He brought in copies of the Wall Street Journal. We had a fantasy stock market. We balanced checkbooks. We learned that mutual funds are always the smarter choice over company stocks, which are inherently risky. It was maybe five hours of my life out of 16 years of formal education. There was a test. 80% of the class passed because, well, we weren’t idiots.

Hell, you barely have to know math to answer the last two. The first one involves an elementary understanding of how financial services products like mutual funds work.

It’s a little scary that most millennials care more about Snapchat and Big Sean/Ariana Grande and selfie-sticks and buying the new Samsung Galaxy 6 than the finance fundamentals that keeps money (…mostly likely from their parents) in their Apply Pay and Venmo accounts.

The SDSU study gets even more scary: Millennials make terrible spending decisions even when they know they better.

“Let’s just put those Coachella ticket payment plans on that Urban Outfitters credit card we don’t have job to pay off. Great idea!”

Perhaps most troubling was what the research showed about how respondents have actually been managing their money. The average young person surveyed showed responsible behavior in only one of three categories: Paying off debts on time, budgeting and living within one’s means, and having any retirement savings at all. Only 2% of all respondents showed responsible behavior in all three categories.

Furthermore, the study—led by SDSU professors Ning Tang, Andrew Baker, and Paula Peter—found that there was little to no effect of financial knowledge on financial behavior. That is, young people manage money poorly, even when they know better.

SMH. But it’s not totally hopeless:

Though the study did not examine the influence of peers, its results suggest both family and financial professionals could play an important role in improving young people’s financial habits. The researchers found that being close with parents was correlated with better money management among women—and that higher self-reported levels of being “thorough” and “careful” was correlated with better financial behavior among men. Among both sexes, higher self-reported levels of being “self-disciplined” was correlated with better money habits.

Just think… 16 years from now, today’s dimwitted 20-year-old fuckbois will be able to official run for President of the United States.


We’re so fucked.

Stripper with cash pic via Shutterstock

[H/T: Time]

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