Americans Score Low For Financial Literacy
Less than half of Americans can pass a financial literacy test, according to NowThis Money.
In a study conducted by the National Financial Educators Council, over 17,000 participants from across the country completed a financial literacy test and scored an average score of 63 percent. Only 48 percent of participants scored a passing score.
The test is comprised of 30 questions covering topics that measure the participants’ knowledge regarding earning, saving and growing their money.
All ages participated in taking the test, with some as young as 10 years old. The 50+ age group scored the highest, with the average score being 76 percent.
The 10 to 14 age group scored surprisingly close to those in the 15 to 18 age group, with the former scoring 54 percent and the latter scoring an average of 60 percent.
Out of the developed and financially literate countries, the U.S. ranks 14th on the list, according to Investopedia. Millennials in the U.S. also scored low, where millennials in China scored higher than middle-aged adults for financial literacy.
Many states now include personal finance classes as part of the standard education in grades K-12, however, some states still have not implemented such courses into the standard education curriculum.
Those states are Montana, New Mexico, Wyoming, Washington, D.C., and California, with D.C. and California being some of the most expensive states to live in, according to NowThis Money.
A study conducted by CareerBuilder showed roughly 78 percent of Americans live paycheck to paycheck, and the number of Americans living in debt is 71 percent.
Fifty-eight percent said they are in over their heads with their credit card debt, with many finding it difficult to save $100 or more a month.
And because Americans find it difficult to save money, half of Americans have no savings account and the other half have less than $1,000 saved, according to CNBC.
However, most Americans also stated their biggest financial regret was not putting away more money for retirement, their children’s education, or emergency expenses.
So how can Americans start saving more money? Financial experts suggest to pay off debt as soon as possible, and start looking at ways to cut down spending by writing out a daily budget and sticking to it.
And lastly, the money that does make it into a savings account, never touch it and allow it to grow by adding to it as much as possible.