Ask the Experts: How Can We Improve Financial Literacy in the U.S.?
Despite signs of economic recovery, it seems like the list of problems standing in the way of a secure financial future for the U.S. is getting longer by the day. From out-of-control student loan debt and habitual consumer overleveraging to Medicare insolvency and an overcomplicated tax code, we clearly have a lot to figure out in a political landscape that’s far from conducive to progress.
Underpinning, and perhaps exacerbating, all of these problems is the disturbing lack of financial literacy in this country. Far too many people know far too little about personal finance, and our poor overall performance in that area simply puts undue pressure on already flawed programs.
Just consider the following statistics:
- Fresh off one of the worst recessions in history, U.S. consumers have racked up roughly $82 billion in credit card debt over the past two years and are on pace to bring amounts owed well beyond the $120 billion by the end of 2013.
- There is currently over $1 trillion in outstanding student loan debt – far more than we owe either credit card companies or auto lenders. The average household balance as of 2010 (when the most recent figures were released) was $26,682, and roughly 40% of households headed by someone aged 35 or younger owe money on student loans.
- The United States ranks behind Brazil, Mexico, and Australia in terms of overall financial literacy, according to Visa’s Global Financial Literacy Barometer. Out of the 28 countries surveyed, only Bosnia ranks worse than the U.S. in terms of parents’ perception of how prepared their children are for responsible money management.
- More than a quarter of U.S. adults say they do not pay all of their bills on time, according to the National Foundation for Credit Counseling’s 2013 Financial Literacy Survey. What’s more, 60% of people do not have a budget and 40% give their knowledge of personal finance a grade of “C” or worse.
The question is what are we going to do about our obvious financial illiteracy? WalletHub has written about this issue at length in recent months, and there are a number of great initiates sponsored by universities, corporations, and non-profits already in effect. Congress and individual state governments have explored legislative solutions as well. And many celebrities are even preaching fiscal responsibility. But there is still widespread disagreement about the best ways to foster a financially savvier populous.
What we need is a coordinated plan of attack. So, in the interest of brainstorming such a plan, we turned to leading experts in the fields of education, public policy, and financial planning for ideas. You can check out what they had to say below and even share your own opinions in the comments section at the bottom of the page.
Expert Opinions – What Changes Are Necessary to Foster Increased Financial Literacy?
- How I'd Improve Financial Literacy
- The Importance of Financial Literacy in High School & College
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