Financial IQ

Recently, I went to a class on investing. The instructor was a professional investor. There were only about 12 people in attendance. The first topic was debt. He put two columns on the blackboard, and in the first column he put the word "Good" and in the second he put the word "Bad". He then proceeded to ask us what types of debt would go in each column. Some raised their hands and said that a mortgage and education could go in the Good column, while credit card debt would go in the Bad column.
At that point, he took over. He then added additional items to the Good list, including car loans and investment real estate. It was at that point where I could see where the rest of the class discussion was headed.
The discussion then turned to investing. He used the term "Financial IQ" to explain how he we could become proficient in personal finance and investing, and as we studied we could become as proficient as he is.
Over the last several years while my wife and I got out of debt and began saving for our future, I believe we've increased our Financial IQ, but not by his standards.

What we've learned:

• Any type of debt can turn out to hurt you financially, e.g. getting into a mortgage that requires two incomes to sustain, taking out excessive student loans and then not being able to find a job after graduation
• Teaching our kids that they can have what they want but they have to save for it
• Finding that it's more pleasurable to save than it is to spend
• Finding satisfaction when making a large purchase that we saved for
• Knowing that we have enough money in an emergency fund to handle nearly any financial emergency
• Having more money in our checking account than the current value of the car I drive to work
• Knowing that as we put money in retirement, we can maintain our standard of living after we retire
• Knowing that our kids will be set for college, and that we will be able to fund their high school expenses and weddings
• We should consolidate our IRA accounts and our Roth IRA accounts to make them easier to manage
• We should regularly take classes and stay informed on investments, learning all we can before investing our money
• We have a will and life insurance in place in case one or more of us passes away
  

Based on the list above, I think we'd do pretty well on any Financial IQ test.