Financial Literacy
What is Financial Literacy?
The Federal Reserve Bank of New York City uses these three definitions:
Basic personal financial management skills, including understanding of income, money management, saving, investing, spending and credit.
The ability to make critical financial decisions.
Knowing how to manage money, use credit effectively, build wealth, and make good financial decisions.
Why is Financial Literacy Important?
According to the Federal Reserve Bank, New York City
The financial well-being of individuals is linked closely to the nation’s economic progress.
Financial literacy among individuals results in more stable communities and a stronger, safer banking system for all.
Improved financial literacy, particularly early in life, results in a higher standard of living over the long term, including retirement.
Gaining financial literacy is a long-term process that, for most people, requires the assistance of institutions outside the home.
Americans Get a "D"
The August 2003 edition of USAA Magazine carried an item in their "Personal Finances" column.
The headline was "Americans Not Making Grade in Financial Literacy."
According to a survey conducted by marketing research firm RoperASW, Americans get a "D" in financial literacy. Bankrate.com, a web-based aggregator of financial data, awarded a grade to those surveyed, based on how well they applied 12 steps considered basic to the average American’s financial well-being.
Timeliness of bill paying, rate comparison shopping, budgeting and short- and long-term financial planning were some of the measures used in the scoring. Respondents received an average score of 67 out of a possible 100 points. Only 10 percent got an "A!"
All content except where noted ©2007 Zions Bancorporation All Rights Reserved.
View our Privacy Policy and Terms of Service Policy. Technical Contact.