Financial Literacy Statistics
The importance of personal finance education is evident as a variety of studies and surveys illustrate financial literacy improvements in recent years since the recession. Through continued personal finance education, we can improve on this trend throughout all age groups, helping Iowan's to be more financially prepared for their future.
Teens & Money
According to the 2011 Teens & Money Survey, nine out of 10 teens say they were "affected by the recession," and the importance of saving has had a lasting effect. While this seems to have improved the awareness of the importance of financial literacy, teens also admit that there is much that they don't know. Three out of four teens agree that learning about money management is a top priority, and a majority of teens prefer to receive financial literacy education in a class before making mistakes in the real world.
Top Lessons Resonating with Teens Today
- It is important to have enough emergency savings in case times get tough. (73%)
- It is easy to get carried away and spend too much when times are good. (59%)
- It is important to understand the consequences of borrowing money. (51%)
Money Topics where 18-year-olds are Less Knowledgeable Today as Compared to 2007
- How credit card interest and fees work (declined from 43% to 32%)
- How to manage a credit card (declined from 64% to 39%)
- How to balance a checkbook or check the accuracy of a bank statement (declined from 60% to 42%)
Source: 2011 Charles Schwab 2011 Teens & Money
Undergraduate Students & Credit Cards
According to the How America Pays for College study conducted by Sallie Mae, the use and ownership of credit cards by undergraduate students has gone down since 2010. Whether due to the introduction of the CARD Act of 2009 or the recession, fewer students are now using credit cards to make their purchases. Thirty percent of undergraduate students report having a credit card in 2013, down from 35 percent in 2012 and 42 percent in 2010.
The average credit card balance held by college students in 2013 was $499 with a median balance of $136. These amounts are down from an average balance of $3,173 and a median balance of $1,645 in 2008. Thirty-two percent of undergraduates have a zero balance and another 46 percent have less than $500 on their cards.
Alternatively, college students are turning to debit cards as their choice of plastic. Seventy-seven percent of college students report carrying a debit card, while twenty-seven carry both and 20 percent don't carry any.
Source: Sallie Mae, "How America Pays for College 2014"
Adults and Financial Literacy
A 2013 financial literacy survey of adults reveals:
- 40% of U.S. adults, or more than 92 million people living in America, gave themselves a grade of C, D, or F on their knowledge of personal finance, suggesting there is considerable room for improvement.
- 31% of adults (nearly 1/3) report that they have no savings and only 29% are now saving more than they did a year ago.
- 26% admit to not paying all of their bills on time.
Source: The National Foundation for Credit Counseling and Harris Interactive Inc., Public Relations Research, The 2013 Consumer Financial Literacy Survey, 2013