The good news is that roughly half to two-thirds of Americans understand basic finance terms and concepts. The bad news is that a sizable minority have never learned some basic money skills.

GoBankingRates, a personal finance news and features website, conducted a survey that measured respondents’ knowledge of fundamental financial terminology and concepts in personal finance to get an understanding of the average American’s level of financial literacy.

The survey posed six questions to 529 survey respondents from all 50 states and the District of Columbia on March 22.

Question 1: “Which of the following describes a 401k?

Many financial education programs and consumer habits are still falling short after the recession.

Sixty-three percent of respondents correctly responded, “Retirement savings vehicle,” including 60% of respondents 25 and older.

However, only 43% of 18-to-24 year olds did so, while at least one-fifth across all age groups incorrectly selected “tax credit for retirement.”

Question 2: “What does a CD offered by a bank stand for?”

This question got the most correct responses, as 68% of respondents correctly selected “Certificate of Deposit.” Seventy-one percent of women got the answer right, versus 65% of men.

However, the age breakdown revealed larger knowledge gaps about CDs:

  • Only 36% of 18-to-24-year-olds answered correctly
  • 60% of correct responses came from 25-to 34-year-olds, followed by 71% from 35—to-44-year-olds
  • 80% or more of older respondents answered correctly

GoBankingRates noted that not knowing about CDs could mean missing out on an easy way to grow wealth.

Question 3: “What is net worth?”

Only 59% of respondents selected “value of someone’s assets minus their liabilities” as the correct formula to calculate net worth. Sixteen percent thought “income after taxes” defined the term.

Sixty-four percent of men and 56% of women answered the question correctly; still, 17% of women and 15% of men answered “income after taxes.”

GoBankRates speculated that the word “net” tripped up respondents because net income after taxes is an established accounting term. It said that like net worth, NIAT was an important concept to know.

Question 4: “Which of the following does not impact your credit score?”

As with the previous question, the responses did not break down neatly along demographic lines. Only 60% of respondents correctly selected “income,” meaning 40% might not know all the factors that can affect credit score.

Sixty-four percent of women vs. 56% of men answered this question correctly, with nearly a quarter of men incorrectly choosing “types of current credit” as not having an impact.

Only 55% of respondents 65 and older answered correctly, followed by 57% of 55-to-64-year-olds and 59% of those 18 to 24. Seventy-three percent of people 35 to 44 gave the correct response.

More than a fifth of people 65 and older and those 55 to 64 incorrectly chose “types of current credit,” rising to some 30% of the latter group.

GoBankingRates said it was understandable that “types of current credit” got the highest percentage of incorrect responses because this factor accounts for a mere 10% of credit score points.

Question 5: “What does HELOC stand for?”

Albeit, not a really basic questions, but twenty-two percent of respondents chose the answer “HELOC is not a real thing.” In fact, home equity lines of credit are for real.

The survey failed to find a clear correlation between ages and financial knowledge for this questions.

Sixty-eight percent of respondents 35 to 44, 63% between 55 and 64 and 60% between 18 and 24 answered correctly. In contrast, only 52% or people 65 and older did so.

GoBankRates said the most interesting aspect of the age breakdown was the high percentage of retirement-age respondents who answered incorrectly. Not only did just slight less than half answer incorrectly, nearly a third chose “HELOC is not a real thing.”

It said this could reflect an increasing popularity in the use of HELOCs in recent years compared with the past.

Question 6: “What are the three major credit bureaus?”

Sixty-five percent of respondents correctly identified TransUnion, Equifax and Experian as the three major credit bureaus in the U.S.

However, the breakdown of respondents by age was revealing. Sixty percent of those 25 and older answered correctly, rising to 85% for those 45 to 54.

At the same time, a mere 29% of the 18-to-24 age group gave the correct response. Forty-six percent of this group said “Visa, Mastercard, American Express,” while 20% said “Bank of America, Wells Fargo and Chase.”

Why do so many young millennials think Visa, MasterCard and American Express are the major credit bureaus?

GoBankingRates suggested this was because they have had fewer situations that required pulling their credit scores, such as applying for an apartment lease or home mortgage. Another possibility: it is easy for 18-to-24-year-olds to get approved for credit cards.

Related on ThinkAdvisor April 19 2017