Shocking Results: Widespread Financial Illiteracy Among Top Students
Goalsetter, an award-winning family financial education platform, has released a startling report titled “Are You Financially Smarter Than a 12th Grader?”. The study exposed concerning gaps in personal finance knowledge among students at three of the nation’s Top Ten universities.
“The results of this study underscore the critical need for earlier preparation when it comes to financial education,” said Tanya Van Court, CEO of Goalsetter.
Average Failing Grade of 51%
The assessment, conducted by Goalsetter, evaluated the financial literacy levels of 1,065 undergraduate students through an online quiz. Shockingly, students scored an average of just 51% – a failing grade by academic standards.
“On average, students scored 51% with underclassmen scoring even lower at 48%, both of which would be considered failing grades.”
Overconfidence and Knowledge Gaps
Prior to taking the quiz, 55% of students believed they had a solid understanding of core personal finance concepts. However, after completing the assessment, only 30% remained confident in their knowledge.
“Not surprisingly, 93% of students surveyed have a debit card, indicating their familiarity with spending. However, only 48% understood the power of compound interest, and only 47% knew the 50/30/20 rule of budgeting.”
Urgent Need for Financial Education Initiatives
The results align with broader national trends, highlighting the pressing need for enhanced financial education initiatives for teens and young adults in the United States.
“When we fail to prepare our children with the financial knowledge they will need for everyday decisions, we set them up to learn by trial and error, making them susceptible to expensive mistakes,” said Van Court.
Goalsetter’s Efforts to Promote Financial Literacy
Goalsetter is leading efforts to provide game-based financial education integrated into teen debit cards, including features like “Learn Before you Burn,” which freezes kids’ debit cards if they haven’t taken their financial literacy quiz for the week.
“Goalsetter also offers weekly financial education quizzes for Kindergarten through College, mapped to National financial literacy standards published by the Council for Economic Education and Jumpstart.org.”
With its advocacy and partnerships, Goalsetter aims to equip the next generation with essential financial knowledge and skills for a secure financial future.
