Since 2006, the National Foundation for Credit Counseling (NFCC) has been releasing its annual financial literacy survey to kick off Financial Literacy Month each April. The 2014 Financial Literacy Survey, released today, was conducted in the U.S.in March with more than 2,000 adults over the age of 18 participating.
Financial education sorely needed
Unfortunately, the survey reveals that Americans are not getting any smarter when it comes to basic personal finance matters. The survey revealed significant gaps in understanding of budgeting, saving, credit reports and credit scores.
“This year’s survey once again confirms what we already know: the need for financial education is great,” said Susan C. Keating, president and CEO of the NFCC. “Without a solid foundation on which to base everyday financial decisions, Americans are on a slippery slope as they begin to rebuild their financial lives following the Great Recession. To meet the need, the NFCC developed the three-step Sharpen Your Financial Focus™ program which provides consumers with the tools necessary to secure financial well-being. We encourage others to join this nationally driven financial education movement by supporting this initiative.”
- The highest percentage of adults in six years, 61 percent, do not have a budget.
- Thirty-four percent of households carry credit card debt every month, with fifteen percent carrying over $2,500 each month.
- Sixty percent have not reviewed their credit score or a credit report in the past year and 23 percent of those who knew their credit score did not think that they needed to check their credit report. Both the credit score and credit report play a critical role in being able to secure credit at an affordable rate.
- Forty-one percent of adults gave themselves a grade of C, D or F on their knowledge of personal finance.
Concerns about saving and spending
Although consumers are uncomfortable with their lack of savings, they may have nonetheless continually increased their year-over-year spending.
When respondents were asked which areas of personal finance caused the most concern, 16 percent said insufficient emergency savings and another 16 percent are concerned about not having enough in retirement savings. Despite these worries, the proportion of adults who are spending less when compared to the previous year declined to 29 percent from the 2009 high of 57 percent.
- The 30-page full survey results and information can be viewed online at NFCC.com.
The 2014 Financial Literacy Survey was conducted online within the United States by Harris Poll on behalf of the NFCC (National Foundation for Credit Counseling) between March 4 and March 6, 2014 among 2,016 adults aged 18 and older. This year’s survey was sponsored by Experian Consumer Services (ECS). Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was used to adjust for respondents’ propensity to be online. Prior to 2013, this survey was conducted by telephone.