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Take
a look at these statistics to see how poorly we as Americans score
in the area of Financial Literacy. While it is true that the younger
generation of Americans is at risk financially, a look at the spending
behaviors of their parents reveals in many cases, they aren't doing
much better. It seems that Americans are in need of an extreme financial
make-over. Do you see yourself or your family anywhere in these
findings?
- A
Consumer Reports survey of 12 year olds found that 28% didn't
know that credit cards are a form of borrowing, 40% didn't
know that banks charge interest on loans, 34% didn't know that
you can't tell how good a product is by how much it's advertised.
- Bankruptcy
filings for those in the 18-25 year age group were at an all
time high in 2000--numbering almost 150,000, which is a tenfold
increase in just 5 years. This is the fastest growing age range
for bankruptcies, with more young adults filing for bankruptcy
than graduating from college in 2001.
- 83%
of undergraduates have at least 1 credit card and the average
credit card balance is $2,327.
- Graduating
students have an average of $20,402 in combined education loans
and credit card debt, with 20% of graduating college students
having $10,000 or more in non-school related credit card debt.
- Students
double their average credit card debt--and triple the number
of credit cards in their wallets from the time they arrive on
campus until graduation.
- University
administrators state that they lose more students to credit
card debt than to academic failure.
- 50.8%
of college students agree with the statement: "I have experienced
repeated, unsuccessful attempts to control, cut back, or stop
excessive money use."
- College
students make up 10-15% of those seeking money management help.
- One-half
of all Americans are living from paycheck to paycheck.
- From
1992-2000, disposable income rose 47%, but personal spending
increased by 61%.
- 40%
of Americans say they live beyond their means.
- Average
credit card debt per household rose from $2,985 in 1990 to $8,562
in 2002.
- 43%
of adults at the lowest level of financial literacy live in
poverty, compared to only 4% of those at the highest level of
financial literacy.
- The
U.S. has the lowest personal savings rate of any major industrialized
nation. In fact, the personal saving rate went negative for
the first time ever in 1998. Americans are spending $100.20
for every $100.00 they bring home.
- On
average, the typical credit card purchase is 112% higher than
if using cash.
- An
$8,000 debt, at a rate of 18% interest, will take over 25 years
to pay off and cost more than $24,000 in the long run.
- Today's
average 50 year old has only saved $2,300 towards retirement.
- The
average American spends 18 years in retirement (by the year
2050, the average American will spend 30 years in retirement)
and less than half of Americans have put aside money specifically
for retirement.
- Half
of American households have savings of less than $1,200.
- The
average American household has less than $100 per month of discretionary
disposable income.
- More
than half of us are not saving enough to maintain anything like
our present standard of living upon retirement. By the year
2010, 78 million Americans will be 65 or older. One in 3 has
no retirement savings.
- 55%
of Americans have no idea how much they will need to save to
make their retirement dreams a reality.
- Almost
half of all workers have accumulated less than $50,000 for their
retirement, and 1/3 have saved less than $10,000.
- Women
are twice as likely as men during retirement to receive income
below the poverty level.
Don't
lose hope just yet, there are some reasons to remain optimistic,
such as:
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33%
of employees increased their contributions to their retirement
savings plan after receiving financial education.
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Some
77% of high school respondents have a savings account.
-
61%
of college students pay their credit card balances in full each
month.
-
Teenagers
can and do respond positively to instruction aimed at improving
their money management skills.
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Most
people want financial education.
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