Survey Reveals that Only 57% of Americans Possess Even Basic Financial Literacy

 April is Financial Literacy Month in the United States (do they have it anywhere else?), and, based on the results of a recent global survey on money smarts, it looks like our nation will be setting aside a month devoted to the subject for some time to come.

According to the data compiled by the folks behind the Standard & Poor���s Ratings Services Global Financial Literacy Survey, only 57% of Americans passed the test, which by no means asked respondents particularly challenging money-related questions. That result puts Americans behind Canadians, Germans, and residents of the United Kingdom in basic understanding of matters financial. Furthermore, the survey revealed that American teens have a level of understanding of basic financial issues that ranks them between teens of Russia and Latvia.

The survey asked five questions. Here are two of them:

1. Suppose over the next 10 years the prices of the things you buy double. If your income ALSO doubles, will you be able to buy less than you can buy today, the same as you can buy today, OR more than you can buy today?

2. Suppose you put money in the bank for two years and the bank agrees to add 15 percent per year to your account. Will the bank add MORE money to your account the second year than it did the first year, or will it add the same amount of money both years?

Assuming you want to take the quiz for real, which you can do by navigating to the appropriate page from the embedded article, I won���t reveal the answers to these two questions, but you now have some idea of the level of financial acumen assessed by the survey. While the questions are not perfectly written, those who do not overthink them should be able to get a good read on their own level of basic financial knowledge, and decide if they have any ���remedial��� work to do.

By Robert G. Yetman, Jr. Editor At Large