Understanding the FBLA Personal Finance Competition
Event Structure and Format
Personal Finance provides members with the opportunity to demonstrate knowledge around introductory competencies in financial skills. This competitive event consists of an objective test and aims to inspire members to learn how to manage personal finances.
The competition is structured as a 50-minute online objective test administered at both regional and state levels. No reference or study materials may be brought to the testing site, making thorough preparation absolutely critical for success.
At the regional level, up to 3 members per chapter can compete. The 1st, 2nd, and 3rd place regional winners advance to the state conference, where the top 4 state winners become eligible for the National Leadership Conference.
What Makes This Event Competitive
The FBLA Personal Finance event attracts high participation because financial literacy is increasingly recognized as essential life knowledge. According to recent studies, mandated personal finance education in high school improved credit scores and reduced default rates of young adults, making this knowledge immediately valuable.
The event tests comprehensive understanding across seven major topic areas, requiring both theoretical knowledge and practical application. Success demands mastering everything from basic economic principles to complex investment strategies.
The Seven Essential Topic Areas
1. Financial Principles Related to Personal Decision Making
This foundational area covers core economic concepts and decision-making processes. Key competencies include:
Economic Fundamentals:
- Define money (characteristics, role, and forms) and trace how money and resources flow through the American economic system
- Define basic economic concepts such as supply and demand; production, distribution, and consumption; labor, wages, and capital; inflation and deflation
- Evaluate how decisions made at one stage of life can affect options at other stages
Decision-Making Skills:
- Find and evaluate financial information from a variety of sources
- Identify opportunity costs and trade-offs associated with financial decisions
- Apply decision-making processes to personal finance situations
I remember struggling with opportunity cost concepts until I realized it’s simply “what you give up when you choose something else.” This mindset shift helped me excel in this section.
2. Earning a Living (Income, Taxes)
Understanding income sources and tax implications is crucial for competitive success:
Income Types:
- Wages, salaries, commissions, and bonuses
- Self-employment and entrepreneurial income
- Investment income and passive revenue streams
- Government benefits and transfer payments
Tax Concepts:
- Federal, state, and local tax systems
- Progressive vs. flat tax structures
- Deductions, exemptions, and tax credits
- Social Security and Medicare taxes
Practical Applications:
- Calculate gross vs. net income
- Understand payroll deductions
- Evaluate job offers considering total compensation packages
3. Managing Budgets and Finance (Planning and Money Management)
Budgeting forms the foundation of personal financial success:
Budget Creation:
- Describe the effect of different payment methods—cash, credit, installment loans, mortgages, debit cards, checks or online deposits, transfers, and payments on the budget and financial plan
- Use financial management software to prepare a budget, track income and expenses, and project taxes
- Identify serious problems that can arise when you don’t plan your finances or implement your financial plan
Money Management Strategies:
- 50-30-20 budgeting method (needs, wants, savings)
- Zero-based budgeting techniques
- Emergency fund planning and maintenance
- Cash flow management and forecasting
4. Saving and Investing
This complex area requires understanding both basic savings and advanced investment concepts:
Saving Fundamentals:
- Define investment terms including risk management, yields, and rate of return
- Explain how investing and saving builds wealth and helps meet financial goals
- Distinguish between short- and long-term savings goals
- Determine saving options and the need for and purpose of savings
Investment Concepts:
- Evaluate investment alternatives and sources of investment information
- Prepare a personal investment strategy
- Understand stocks, bonds, mutual funds, and ETFs
- Investigate how agencies that regulate financial markets protect investors
Key Formulas to Master:
- Compound interest calculations
- Risk-return relationships
- Portfolio diversification principles
- Time value of money concepts
5. Buying Goods and Services
Smart consumer behavior and purchasing decisions are tested extensively:
Comparison Shopping:
- Compare and contrast advantages and disadvantages of renting versus purchasing property such as a home, auto, and equipment
- Calculate costs involved in purchasing and maintaining a vehicle and a home and methods of figuring depreciation
- Determine spending patterns based on a review of financial records
Consumer Protection:
- Evaluate information about products and services such as warranties, clearance items, and consumer reports
- Compare advantages and disadvantages of alternative payment types—credit, cash, loans, etc.
- Describe rights and responsibilities of buyers and sellers under consumer protection laws
6. Banking and Insurance
Understanding financial institutions and risk management is essential:
Banking Services:
- Compare different types of banking options such as credit unions and other banks
- Identify types of banking services and their costs for meeting various needs
- Write a check and prepare deposits and withdrawal slips
- Maintain a check register including proper procedures for ATM and automatic payment withdrawals
Insurance Fundamentals:
- Identify common types of risks and basic risk management methods
- Identify purpose, importance, and major characteristics of property and liability insurance protection
- Calculate insurance costs and evaluate coverage options
Critical Banking Knowledge:
- The Federal Deposit Insurance Company insures bank deposits up to $250,000
- Money Market Accounts have interest rates that vary monthly
- Compounding is the process in which interest is earned on the principal and previously earned interest
7. Credit and Debt
Credit management often determines success in this competition:
Credit Fundamentals:
- Identify costs, benefits, and sources of various types of credit
- Give advantages and disadvantages of using credit in specific situations
- Explain the purpose of a credit record and identify borrowers’ credit report rights
- Develop and use personal debt-reduction strategies to manage and avoid or correct debt problems
Advanced Credit Concepts:
- Evaluate terms and conditions of credit offers and make recommendations based on analysis
- Evaluate the concept of creditworthiness as it relates to credit records, credit ratings, credit reports, and credit laws
- Understand grace periods, minimum payments, and interest calculations
Key Credit Facts:
- Two advantages of credit: use of product while paying for it and easier returns/exchanges
- An example of open-ended credit is Mastercard
- Most credit card companies offer grace periods
Proven Study Strategies
Create a Systematic Study Plan
Based on successful competitors’ approaches, allocate your study time proportionally:
- 20% Financial Principles and Decision Making
- 15% Earning a Living and Taxes
- 20% Budgeting and Money Management
- 20% Saving and Investing
- 10% Buying Goods and Services
- 10% Banking and Insurance
- 15% Credit and Debt
Use Active Learning Techniques
Flashcard Systems: Create flashcards for key terms, formulas, and concepts. Focus on items you consistently miss rather than reviewing everything equally. Online platforms like Quizlet offer pre-made FBLA Personal Finance sets, but creating your own enhances retention.
Practice Problem Sets: Work through calculation problems regularly. Master compound interest, loan payment calculations, and budget scenarios. The FBLA Test Frenzy website provides practice questions from actual past tests.
Real-World Applications: Connect concepts to current events and personal experiences. Follow financial news, analyze family budget decisions, and practice using financial calculators and apps.
Master the Test Format
Time Management: With 50 minutes for the objective test, pace yourself carefully. Aim for approximately 60 seconds per question, allowing time for review.
Question Types:
- Multiple choice questions testing specific knowledge
- Calculation problems requiring mathematical skills
- Scenario-based questions applying concepts to situations
- Definition and terminology identification
Essential Resources for Success
Official FBLA Materials
The official FBLA Personal Finance guideline document provides the complete competency list and serves as your primary study blueprint. State FBLA organizations often provide additional resources and practice materials.
Recommended Study Materials
Digital Resources:
- FBLA Financial Literacy Initiative personal finance course
- EVERFI’s free high school financial literacy course
- Khan Academy’s personal finance section
- Consumer Financial Protection Bureau youth financial education activities
Practice Tests:
- FBLA Test Frenzy practice exams
- Quizlet flashcard sets from previous competitors
- State FBLA practice tests and study guides
For comprehensive financial education resources that complement your FBLA preparation, explore these finance learning materials and tools that can deepen your understanding of key concepts.
Professional Development
Consider pursuing additional certifications or courses that align with FBLA Personal Finance topics. Many successful competitors supplement their preparation with online financial literacy courses or local banking seminars.
Competition Day Success Tips
Pre-Test Preparation
Equipment Checklist:
- Sharpened pencils (multiple)
- Conference-provided nametag
- Attire meeting FBLA dress code requirements
- Positive mindset and confidence
Mental Preparation: Arrive early, review key formulas one final time, and stay calm. Remember that you’ve prepared thoroughly and trust your knowledge.
During the Test
Strategic Approach:
- Read all questions completely before answering
- Start with questions you know confidently
- Flag difficult questions for review
- Double-check calculations when time permits
Common Pitfalls to Avoid:
- Rushing through mathematical calculations
- Confusing similar financial terms
- Overthinking straightforward questions
- Leaving questions blank (guess if necessary)
Beyond the Competition
The knowledge you gain preparing for FBLA Personal Finance extends far beyond competitive success. According to research, only 31% of young Americans believe their high school education taught them healthy financial habits, making your expertise immediately valuable.
This preparation positions you for future success in business, finance, and economics courses. Many competitors pursue careers in financial planning, banking, wealth management, and related fields where this foundational knowledge provides significant advantages.
The competition also develops critical thinking, analytical skills, and confidence in handling complex financial decisions—abilities that serve you throughout life regardless of your career path.
Your Path to Victory
FBLA Personal Finance competition success requires systematic preparation, deep conceptual understanding, and strategic test-taking skills. The seven core topic areas provide a comprehensive framework for mastering essential financial literacy concepts.
Your commitment to studying personal finance through FBLA demonstrates exceptional preparation for adult financial responsibilities. The knowledge, skills, and confidence you develop through this competition create lasting advantages in both academic and professional pursuits.
The opportunity to excel in this competition while building essential life skills makes FBLA Personal Finance one of the most valuable events you can choose. With thorough preparation and strategic execution, you’re positioned to achieve outstanding results at every competition level.
Ready to dominate the FBLA Personal Finance competition? Which topic area do you find most challenging—budgeting, investing, or credit management? Share your study strategies and let’s help each other succeed in the comments below!