FINANCIAL LITERACY 101
Do you have a household budget? Good for you — you're only slightly in the majority. More than four in 10 adults in the U.S. keep no household budget, and about the same number don't have savings that aren't already earmarked for
retirement. In short, collectively we don’t know much about the basics of responsible spending.
FINANCIAL LITERACY REPORT CARD
77 million U.S. adults, about one-third, don't pay all off their bills on time.
56% of U.S. adults do not have a budget.
39% of U.S. adults carry credit card debt over month-to-month.
2 IN 5 in the U.S. are saving less now than a year ago.1
39% of U.S. adults have no non-retirement savings.
A CLOSER LOOK
Many Americans use short-term loans and have inadequate savings.
If young people have a working knowledge of saving, spending and credit, it’s probably not because they learned it in school.
57% of parents with kids in high school or college give schools below average grades in teaching responsible spending.
37% of Americans say they learned basic money management on their own.
22% of Americans learned from their fathers.
35% of parents give schools an F in financial literacy, while about the same number (37%) say schools are successful at teaching safe sex.
5% of Americans learned about money matters from a teacher.
25% of Americans learned from their mothers.
FINANCIAL LITERACY QUIZ
How much do you know? The avg score of quiz is 3
- "I Suppose you have $100 in a savings account earning two percent interest a year. After five years, would you have.-
- More than $102
- Less than $102
- Exactly $102
- Imagine that the interest rate on your savings account is one percent a year and inflation is two percent a year. After one year, would the money in the account buy...
- More than it does today
- Exactly the same as it does today
- Less than it does today
- If interest rates rise, what will typically happen to bond prices?
- Stay the same
- There is no relationship
- True or false: A IS-year mortgage typically requires higher monthly payments than a 30-year mortgage, but the total interest over the life of the loan will be less.
- True or false: Buying a single company's stock usually provides a safer return than a stock mutual fund.
HOW TO IMPROVE YOUR SCORE
¦ Make financial goals
Establish short- and long-term goals, using a worksheet if necessary, to start planning goals within important areas of your life including education, housing, healthcare and recreation.
¦ Follow a budget
Even a simple budget that tallies what you earn versus what you spend can help improve your financial well-being.
¦ Build credit wisely
Don't be afraid of credit, but don't abuse it either. A strong credit profile can only be built through responsible use of credit cards. Many cards come with rewards programs that allow you to earn points, miles or cash back.
¦ Plan for the future — saving and investing
Are you saving money each month? Do you have enough to live on if you were to lose your job? Are you investing your money to help it grow? You don’t have to leap head-first into the stock market, but saving and investing can begin
through small efforts. Open a savings account and set up auto-deposit so that the same amount of money is going into the account each month, without you having to move it over. Speak with a trusted financial adviser to talk about
your options for investment.
- Money’s on the way
(IJ 2012 Financial Literacy Survey. National Foundation for Credit Counseling and the Network Branded Prepaid Cord Association. (April J, 2012). Retrieved from
 State-by-State Financial Capability survey FINRA Investor Education Foundation (December 8,2010).
Retrieved from http//www.finraorg/Newsroom/NewjRelease/2010/P1225MI.
3. American Express Spending & Saving Tracker. American Express. (August 10.2011)
Retrieved from http://8bout.americanexpress.com/news/pr/2011/safespend.asp
(4. Mem and Dad MIA' on Teaching Money Management? Visa. (April 2012)
Retrieved from http://www.practicalmoneyslfllls.com/about/press/releases_201 l/0S24.php.
 Study Reveals Need for Tools to Help Parents Teach Kids About Savings. Dough Mam (February 17.2012).
 Financial Qun. FINRA Investor Education Foundation. (2011).