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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. How does the realization that not all work is paid add life to retirement?
(a) People who do not work after retirement live longer.
(b) Retired people are happy because they no longer work.
(c) People who do not work after retirement have fewer health problems.
(d) Retired people know they can still be useful.

2. In the 101 SURE WAYS TO SAVE MONEY section, what do the authors advise people to do in order to save on housing?
(a) Buy a larger home as a hedge against inflation.
(b) Avoid non-traditional housing.
(c) Buy and manage multiple rental properties.
(d) Consider non-traditional housing.

3. What is one advantage of estimating the likely timing of the crossover point?
(a) People retire early.
(b) People tend to leave their current job for a more enjoyable one.
(c) People spend less.
(d) People may become more eager about going to work and doing a good job.

4. What is the main pitfall of combining work with true passion or enjoyment?
(a) Enjoyable jobs don't command respect.
(b) Passion doesn't always make up for lack of talent.
(c) Having to compromise in order to satisfy someone else.
(d) Enjoyment goes against the puritan work ethic.

5. If "work" is different from "paid employment," then which of the following is true?
(a) Work includes anything people do to provide a service, including cleaning the house.
(b) Cleaning is only work when it's done by a paid professional.
(c) Retirement is the absence of work.
(d) Volunteer jobs are not work.

6. What percentage of useful life objects could people add if they were not so anxious to replace them?
(a) Twenty to fifty percent.
(b) Ten percent.
(c) One hundred percent.
(d) Fifty to eighty percent.

7. Participants will end up making more money than they spend if they do what?
(a) Follow the philosophy of "no shame, no blame."
(b) Conserve life energy.
(c) Maximize income and minimize expenses.
(d) Retire early.

8. What is Step 8 of the program?
(a) Further reduce monthly expenses.
(b) Estimate when the crossover point will take place.
(c) Retire.
(d) Track investment income.

9. What are two tips for reducing transportation expenses?
(a) Buying a new car and learning to do basic auto maintenance.
(b) Walking to do local errands and learning to do basic auto maintenance.
(c) Walking to do local errands and retiring early.
(d) Retiring early and buying a new car.

10. What is Step 6?
(a) Determining net worth.
(b) Minimizing spending.
(c) Creating a wall chart.
(d) Planning for retirement.

11. Prestige, status, and power can be reasons for what?
(a) Choosing a certain job.
(b) Early retirement.
(c) Retaining life energy.
(d) Keeping up with the neighbors.

12. What is the best method of choosing which expenses to reduce or eliminate?
(a) Use answers to the three questions from Chapter 4.
(b) Compare income to expenses on the wall chart.
(c) Use answers to the three questions from Chapter 3.
(d) Add up the plusses and minuses on the monthly chart.

13. What is the true definition of work?
(a) Anything that is not enjoyable.
(b) Full-time employment.
(c) It varies depending on who is defining it.
(d) Life energy spent.

14. Monthly investment income is calculated by determining current excess money each month, then doing what?
(a) Multiplying it by the current long-term interest rate for U.S. Treasury bonds, then dividing by 12.
(b) Multiplying it by the current long-term interest rate for U.S. Treasury bonds, then multiplying by 12.
(c) Multiplying it by the current short-term interest rate for U.S. Treasury bonds, then multiplying by 12.
(d) Multiplying it by the current short-term interest rate for U.S. Treasury bonds, then dividing by 12.

15. What is the best thing to do with the interest received?
(a) Purchase rental properties.
(b) Reinvest it.
(c) Put the money under a mattress for a rainy day.
(d) Purchase a larger home as a hedge against inflation.

Short Answer Questions

1. What should people do about unusual extra expenses, such as medical bills or birthday parties?

2. What encourages family, friends, and neighbors to support the participant's goals in following this program?

3. How do most people define work?

4. What should people do with their extra money, once they earn more per month than they spend?

5. What mistake do people often make, when describing their jobs?

(see the answer keys)

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