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Financial Literacy and Retirement Planning in the United States
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In this paper, the authors examine financial literacy in the United States using the new National Financial Capability Study, and demonstrate that financial literacy is particularly low among the young, women, and the less-educated.Abstract:
We examine financial literacy in the United States using the new National Financial Capability Study, wherein we demonstrate that financial literacy is particularly low among the young, women, and the less-educated. Moreover, Hispanics and African-Americans score the least well on financial literacy concepts. Interestingly, all groups rate themselves as rather well-informed about financial matters, notwithstanding their actual performance on the key literacy questions. Finally, we show that people who score higher on the financial literacy questions are also much more likely to plan for retirement, which is likely to leave them better positioned for old-age. Our results will inform those seeking to target financial literacy programs to those in most need.read more
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The Economic Importance of Financial Literacy: Theory and Evidence
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References
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Journal ArticleDOI
Financial Literacy and Stock Market Participation
TL;DR: In this article, the authors evaluated the importance of financial literacy by studying its relation to the stock market: are more financially knowledgeable individuals more likely to hold stocks? To assess the direction of causality, they make use of questions measuring financial knowledge before investing in the stock markets.
Posted Content
Household Financial Management: The Connection between Knowledge and Behavior
TL;DR: In this paper, the authors focus on four financial management activities (cash-flow management, credit management, saving, and investment) and analyze the connections between knowledge and behavior, finding that those who knew more were more likely to engage in recommended financial practices.
Journal ArticleDOI
Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education Programs
TL;DR: In this article, a review reveals that many households are unfamiliar with even the most basic economic concepts needed to make saving and investment decisions, and that financial illiteracy is widespread: the young and older people in the United States and other countries appear woefully under-informed about basic financial computations.
Journal ArticleDOI
Financial Literacy Among the Young
TL;DR: The authors showed that financial literacy is low among the young; fewer than one-third of young adults possess basic knowledge of interest rates, inflation, and risk diversification, and that financial knowledge is strongly related to sociodemographic characteristics and family financial sophistication.
Journal ArticleDOI
Planning and Financial Literacy: How Do Women Fare?
TL;DR: The authors found that women display much lower levels of financial literacy than the older population as a whole, and women who are less financially literate are also less likely to plan for retirement and be successful planners.
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