I consider myself to be very in tune when it comes to the economy. I listen to financial advisor radio shows and podcasts, follow the stock market, and my family owns a business and a cluster of properties as well. However, I am very concerned about my friends and classmates when it comes to their knowledge of the economy. I am always hearing friends and other students talking about how they are “broke” or “don’t have enough money” to do simple things. So, I asked five friends simple economic and lifestyle questions to gage their economic literacy.

One of the questions I asked was “What is a mortgage?”. I thought this question would be simple because how can you plan on owning a house if you don’t know what a mortgage is?. Well, it turns out I was wrong. My friend Anthony responded “How you pay for a home???”. Matt then said “I don’t know, something to do with a house”. Both of these answers were wrong. I then proceeded to tell them that a mortgage is the legal document you sign that gives the provider of the loan the right to take your house if you don’t repay it. Both friends gave a shrug of the shoulder in response.

Next I thought I would ask an even simpler lifestyle question. I asked “How much money do you spend a week?”. Dominick said “I don’t know. Under a hundred dollars?”. Well… that was every helpful to know that he spent between one dollar and ninety-nine dollars. Stephanie’s answer to this question was “It varies by week”. So I then followed her up with another question, “Well, how much did you spend on food last week?”. She answered “Last week I spent around twenty, but some weeks I spend over fifty”. I found this quite interesting that one can go week to week with large fluctuations in spending. I then asked the same girl if she has a budget and she responded a simple “not really”.

There are way more questions I would have liked to ask. Questions ranging from banking basics to why some people take large student loans for low paying careers. But through focusing on two areas, the fundamental principle of buying a home and a simple lifestyle question, my original belief was found to be true. People my age are shortsighted when it comes to money.