The majority of American adults consider themselves to be financially literate, but are less confident in the financial literacy of others, according to a recent study conducted by Morning Consult for ABA. While 62 percent expressed confidence that their own level of financial literacy was good or excellent, just 29 percent perceived the average American’s level of financial literacy to be good or excellent.
In reality, approximately 57 percent of Americans are considered financially literate, according to a separate S&P Global study assessing consumers’ basic knowledge of four fundamental financial concepts: interest rates, compounding interest, inflation and risk diversification. The U.S. was ranked 14th in the world for financial literacy, trailing behind countries including Israel, Canada and Germany.
In recognition of Financial Literacy Month in April, the ABA Foundation published five questions and answers consumers can use to test their knowledge of financial concepts. “Financial knowledge is a critical component to leading a successful and stable life,” said ABA SVP Corey Carlisle, executive director of the ABA Foundation. “It’s also an area of improvement for many Americans. By taking the time to brush up on our money management skills, we can put ourselves on a path toward a stronger financial future.”
