Americans Are Confident Regarding Their Financial Future. Is Their Confidence Misplaced?

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April 23, 2015 by Lisa Brammer

As we discussed in a previous blog, April is Financial Literacy Month. NerdWallet, the personal finance website for consumers, and The National Foundation for Credit Counseling (NFCC) weighed in on this topic by releasing the results of their 2015 Financial Literacy Survey.

More than 2,000 adults responded to the online survey and a whopping 92 percent said they are very or somewhat confident in their most recent big financial decision (e.g. refinancing a mortgage, buying a car, or picking a credit card). And almost two out of three said they deserve an “A” or a “B” for their own personal financial knowledge.

However, 70 percent of these same people said they are currently worried about their finances. And it’s no wonder since the survey shows: 60 percent spend without the benefit of a budget, 20 percent spend more than they make, and 60 percent do not have a rainy day fund.

“These findings portray a bigger picture of the financial literacy knowledge American’s lack today,” said Cliff Goldstein, personal finance analyst for NerdWallet. “When we asked respondents where they save or invest their money, we were shocked to find out that, although 65 percent of Americans use a savings account, less than three in ten use potentially higher-yielding investment vehicles such as 401(k) (29 percent) or IRA (25 percent).”

Only 6 percent of those surveyed feel their student loans were a good investment. “Many Americans are spending their adult lives slowly chipping away at a mountain of student loan debt only to find themselves approaching retirement later in life with little or no savings,” said Susan Keating, president and CEO of the NFCC. “The stakes are too high for consumers to let misplaced confidence get in the way of sound financial decisions.”

Think about your own financial literacy. I’m going to leave you with this one question. In the immortal words of Joey Tribbiani, “How you doin’?”

Founded in 1950, United Credit Service, Inc. is a full service, licensed revenue cycle management and debt collection agency in Wisconsin providing effective, customized one on one management and recovery solutions for our business partners. Visit our website at http://www.unitedcreditservice.com, call 877-723-2902 or check out our YouTube video.

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