x Abu Dhabi, UAEFriday 21 July 2017

Ten questions to test your financial literacy

Sometimes we can think that because we earn relatively large amounts of money in the UAE that automatically we know how to manage our finances. Not necessarily so, however. Examine your financial literacy with The National's test.

Sometimes we can think that because we earn relatively large amounts of money in the UAE that automatically we know how to manage our finances.

However, there is a big difference between having money and being able to make that most out of it to guarantee your future.

Financial literacy is at its most simplest an understanding of how money works and the ability to make informed and effective decisions about personal resources.

With rising levels of personal debt in the Emirates it has never been more important to educate oneself.

A first step might be to find out how much you know, or don’t know, by taking our financial literacy quiz below. A score of 6 out of 10 or more shows that you already know quite a bit, less than 6 and you better start swotting.

Questionnaire:

1 Last week Dubai Land Department announced that property transfer fees would be increased from October 6. What is the new transfer fee?

2 per cent of property value

4 per cent of property value

6 per cent of property value

2 What does the acronym Rera stand for?

Real Estate Regulatory Agency

Real Estate Rent Authority

Renewable Energy Resource Assessment

3 The National has launched a financial literacy campaign. Why?

Because helping residents to enhance their financial literacy is critical

Because it supports Abu Dhabi’s Economic Vision to develop a financially literate society

Because the consumer finance market needs greater transparency

4 Compared to credit card interest rates, mortgage rates are typically?

Lower

The same

Higher

5 What does Eibor stand for?

Emirates Interest Bank Official Rate

Emirates Interest Banker’s Official Rate

Emirates Interbank Offered Rate

6 If you amortise 4 per cent per year of the original financing, how many years does it take to pay off the mortgage?

20 years

25 years

30 years

7 If your monthly interest rate is 3 per cent, what is the annual rate?

30 per cent

36 per cent

42.6 per cent

8 If you have a Dh2 million mortgage and pay 1 per cent lower than your neighbour per annum on the original mortgage, how much do you save over 30 years?

Dh 100,000

Dh200,000

Dh600,000

9. If you invest with a return of 10 per cent per year, how many years does it take until you doubled your money?

7 years

10 years

20 years

10. As part of its financial literacy campaign, The National has established a partnership with Pecunia.me to provide

Advice on how you can save money on credit cards

A website where you can compare your salary

A map showing what consumers pay in mortgage rates

Answers: 1 B, 2 A, 3 All of the above, 4 A, 5 C, 6 B, 7 C, 8 C, 9 A, 10 C

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