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Subscribe to RSSThinking of getting married? Instead of popping “the question,” you might want to consider popping these three questions:
- If the chance of getting a disease is 10 percent, how many people out of 1,000 would be expected to get the disease?
- If five people all have the winning numbers in the lottery and the prize is $2 million, how much will each of them get?
- Let’s say you have $200 in a savings account. The account earns 10 percent interest per year. How much would you have in the account at the end of two years?
A newly released study finds that middle-aged couples who both answered those three questions accurately had an average family wealth of $1.7 million.
In marriages where neither spouse could answer any of those questions correctly, the average household wealth was just $200,000.
The study was conducted by researchers at RAND Corp., the University of Southern California and the University of Michigan. It used a sample of married couples from the Health and Retirement Survey, a national survey of Americans who are at least 50 years old that is funded by the National Institute on Aging.
The results were published in this month’s editions of the Economic Journal.
Update:
In case you’re curious, the answers are:
100
$400,000
$242
Leave a Comment:
Got them all right. Learned while young that those who don't know their math are the first to be cheated or taken advantage of.
Well I got all 3 right, but I am well off that 1.7 million mark.
I answered them correctly as well. Where's my check?
What is scary is that I could have answered all the questions before going into High School.
Yesss I am destined to be a millionaire :)
huh
SEND CASH !!!!
Average family wealth - that probably includes savings, real estate equity, paid-up life insurance/cash value, value of household property and vehicles, value of pensions and retirement accounts, etc.
For a couple nearing or just in retirement, that $1.7 million number is probably about what is needed to survive to life expectancy. One good illness or longterm disability can wipe it out.
This was the first written coverage of this study in which I found all three test questions stated. Another article noted that the family wealth had far wider varieties of stock investments when the family's 'financial directors' correctly answered all three questions.
My wife and I both answered all three questions correctly though this is fairly simply arithmetic. My Frau has undergraduate & a professional masters degrees from educational institutions in Boston and her father was a physicist / college professor who quietly (almost surreptitiously) amassed a middle-class fortune/retirement composed largely of stocks. I had 9 years of education / training after college. Now in our 50s we together have nearly 2 million 'set aside' for the future though it was nearly $300k greater prior to the current recession -- this too shall pass.
Even with education and ability, it is clearly important that one actually pay attention to finances -- one must avoid excessively risky / greedy investments and gaudy consumerism as well as stupidly self-indulgent, profligate spending. We have three 20-something children, all of whom have college degrees paid in full - as younger children & teens, we bought them things that promoted their intellectual or artistic development but NEVER bought them the ridiculously priced "fancy shoes" that were the CURRENT FAD. Fortunately, all three kids seemed to understand the absurdity and shallowness of 'putting on a show' and appreciated our family individualism and non-conformity. Finally, my wife and I have been married just once and that was to each for over 30 years now -- that helps markedly if you want to have something left for your more mature years!