The results of a new survey by Equifax has found that while most Americans have a working knowledge of their finances, a mere 15 percent say they are financially literate. A fifth of those surveyed said they know more about national politics than their own credit histories. About 6 percent are more up on fashion trends.
But, Equifax learned through its survey, most consumers are taking steps to educate themselves when it comes to financial literacy. Nine in 10 responders said teaching financial literacy should be required in school systems. Seventeen percent of responders said they have already learned about financial literacy through a high school or college class.
Nearly half the responders said they read news articles on financial websites over the past year, while almost a third sought guidance from family and friends. Parents were the most popular source of information; 41 percent said they asked their parents for financial guidance.
Dann Adams, president of Global Consumer Solutions at Equifax said that "without a basic understanding of credit and your own behaviors, it can become challenging to do some of the basic fundamentals such as save for retirement, establish an emergency savings account, or move beyond living paycheck to paycheck.”
Survey takers seem to be on the same page, at least as far as being financially responsible.
"One of the survey's results we found encouraging is that many consumers understand the importance of paying bills on time, every time,” Adams said.
According to the survey, 87 percent of responders said they knew paying bills on time is one factor that affects a credit score. Another 42 percent said they knew that most types of negative information can stay on a credit report for seven years. This is up slightly from the 40 percent of surveyed consumers who knew this same information in Equifax’s 2016 report.
Another bright spot is that almost two-thirds of those surveyed said they confident about their short- and long-term financial futures. Respondents age 60 and older were most confident about their financial futures; however, respondents aged 45 through 59 were least confident.
Despite encouraging trends towards greater financial literacy, only a quarter of responders said they were actively saving for the proverbial rainy day. However, not saving could have more to do with practical financial status than the wish to save.