Teens score a D minus in new financial education survey
As credit unions mark Financial Literacy Month and seek opportunities to improve consumers’ financial literacy skills during the coronavirus crisis, a new study shows teenagers’ financial literacy is getting worse.
That’s according to a new study from the National Financial Educators Council — conducted in December — that surveyed nearly 7,000 people between the ages of 15 and 18 to get a sense of their personal financial knowledge. The result? The average score dropped nearly two percentage points from 66.3% in 2018 to 64.9% in 2019.
If this were a test in high school, that would equate to an average of roughly a D minus.
The 30-question National Financial Literacy Test assessed youngsters' understanding of how to earn, save and grow wealth. Nearly 54% received a score of 70% or worse, signaling what NFEC said was “a significant room for improvement in youth and young adult financial literacy.”
"This nationwide test demonstrates that average young Americans lack the basic financial knowledge they need to make informed financial decisions,” Vince Shorb, CEO of the National Financial Educators Council, said in a press release. “While testing represents an indicator of content knowledge, unlike other subjects typically taught in school, financial literacy requires more than just understanding content. Learners must be able to modify their daily financial behaviors and gain enough knowledge to make financial decisions confidently."
Credit unions have long provided financial education offerings for consumers all the way down to the grade-school level, and the NFEC study is in line with previous reporting on trends in that area. One study released earlier this year indicated that even before COVID-19 consumers would likely need help achieving their financial goals. In order to help improve financial education, some credit unions have tweaked their education programs to align them with state-mandated financial literacy courses.
The good news about the NFEC study is that older adults scored higher than teens, even if their results still indicated plenty of room for improvement. All age groups over the age of 25 had an average score of 75% or better, though no group cracked the 80% threshold.