Thursday, November 19, 2015

Americans So-So on Financial Literacy

In a worldwide survey of financial literacy, the United States scored only so-so for a major advanced economy. Fifty-seven percent of Americans correctly answered three of four financial literacy questions: understanding interest rates, compound interest, inflation, and risk diversification. Among the 144 nation's included in the survey, the U.S. ranked 14th. Norway was number one, with 71 percent of  its residents able to answer three of the four questions. Yemen was last, with only 13 percent answering three questions correctly.

Within the United States, financial literacy varies by demographic characteristic. Men are more literate than women (62 versus 52 percent). The middle-aged (aged 35 to 54) are more literate than younger or older adults (65 versus 57 percent), and the richest 60 percent of Americans are more literate than the poorest 40 percent (64 versus 47 percent).

Source: Standard & Poor's Ratings Services Global Financial Literacy Survey

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