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How Financially Literate Are You With Investing?

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How Financially Literate Are You Compared to the Average American?

Are You Financially Literate?

If you’ve ever paid attention to any report on financial literacy from around the world, you’ll likely know that the results aren’t exactly awe-inspiring.

For example, according to one global survey, only about 33% of adults are financially literate.

Americans tend to fare better on average, but not as much as you might imagine. In fact, as we showed in our infographic on the Financial Literacy Problem, one ongoing survey actually sees average U.S. performance slowly dropping over time.

It raises the question: what do people actually know about money, investing, and wealth?

Investment Literacy

A recent poll by Lexington Law aimed to get a sense of U.S. financial literacy, with a focus on basic investment knowledge on stocks, bonds, and building a safe portfolio.

Specifically, it asked 4,000 Americans four different multiple choice questions:

  1. What is the safest investment type?
  2. What happens to bond prices when interest rates rise?
  3. What is a bull market?
  4. What happens to your stock if a company goes bankrupt?

If you think you know the answers to even two of these questions, you are off to a good start!

The survey ultimately found that the average score on this test was 48.8% – meaning that Americans get slightly fewer than two questions correct on average.

Cheat Sheet

Question #1: Safest Investment
Based on the options provided on the multiple choice, the correct answer was Treasury Bonds. Roughly 53% of Americans would get this right, if asked.

Question #2: Bond Prices
Only 25% of respondents said that bond prices would decrease if interest rates rise, which is the correct answer. To be fair, this relationship is somewhat counterintuitive.

Question #3: Bull Market
With the current bull market becoming the longest in history this month, this terminology has been all over the news. That said, just 53% of respondents understood a bull market to be a period in which stock prices are expected to rise.

Question #4: Bankruptcy
If you own a stock and the company goes bankrupt, what happens? Interestingly, people fared best on this question, with 64% realizing that the stock becomes “virtually worthless”. It’s worth noting, however, that a 64% success rate is still the grading equivalent of a “D”.

How did you do on this test – are you financially literate about investments? Where did you go wrong?

If you need to brush up on investing knowledge, don’t forget to visit our Wealth 101 project that features easy-to-use infographics about personal finance topics.

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The Wealthiest People in the World, Outside of America

This graphic shows the wealthiest people in the world that live in countries either than America, from luxury moguls to India’s titans.

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The Wealthiest People in the World, Outside of America

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

Today, nine of the top 10 wealthiest people in the world are American, largely due to fortunes in big tech—but looking beyond U.S. borders tells a different story.

In Asia, people in the highest echelons of wealth are energy and industrial titans, while the richest in Europe run luxury conglomerates and major consumer firms. Many of these companies are well known globally, and several are only known within their region.

This graphic shows the richest people that live outside of America, based on data from Bloomberg.

The World’s Richest: A Global Perspective

Here are the wealthiest non-American people in the world as of January 2024:

RankNameCountryNet Worth
Jan 2024
1Bernard Arnault🇫🇷 France$183B
2Mukesh Ambani🇮🇳 India$108B
3Carlos Slim🇲🇽 Mexico$101B
4Françoise Bettencourt Meyers🇫🇷 France$97B
5Gautam Adani🇮🇳 India$96B
6Amancio Ortega🇪🇸 Spain$85B
7Zhong Shanshan🇨🇳 China$62B
8Gerard Wertheimer🇫🇷 France$47B

France’s Bernard Arnault, with a net worth of $183 billion, is the world’s richest person thanks to the success of LVMH, the luxury conglomerate he runs.

With brands including Louis Vuitton, Fendi, and Christian Dior, LVMH is among the largest public companies in Europe, reaching a $444 billion valuation in 2024. Last year, the company witnessed record revenues driven by sales in its fashion and leather divisions.

Latin America’s richest person is Carlos Slim, with a fortune of $101 billion. Slim’s net worth is equal to nearly 8% of Mexico’s GDP. His wealth is largely derived from his ownership of América Móvil, Latin America’s largest mobile-phone operator, as well as his conglomerate, Grupo Carso.

The world’s richest woman is Françoise Bettencourt Meyers, also from France. According to Bloomberg, Bettencourt Meyers’ controls one-third of L’Oreal, and is the chairwoman of her family’s private equity firm, Tethys Investments.

As China’s richest person, Zhong Shanshan is chairman of bottled water company, Nongfu Spring. The company is listed on the Stock Exchange of Hong Kong, where it raised $1.1 billion from its 2020 IPO. He is also involved with Beijing Wantai Biological Pharmacy Enterprise, a producer of vaccines.

While the richest people in America are heavily concentrated in tech, not one on this list derives the majority of their wealth from the sector, illustrating a clear departure from this trend.

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