Teens Have a Low Personal Finance IQ April 6, 2006
According to a nationwide survey released Wednesday, high school seniors answered correctly only 52.4 percent of questions about personal finance and economics.
- Just 22.7 percent knew that income tax may be charged on the interest earned from a savings account at a bank if a person’s income is high enough. Nearly 51 percent said that earnings from savings account interest may not be taxed. In the last survey, 23.9 percent chose the correct answer.
- Nearly 38 percent correctly said that retirement income paid by a company is called a pension. That’s up from 34.2 percent who answered right in the last survey. Still, close to 59 percent in the current survey thought it was called Social Security or a 401(k).
- Only 28.6 percent knew that a bond issued by one of the 50 states is not protected by the federal government against loss. In the previous survey, 35.3 percent chose the right answer - that such bonds are not federally protected against loss.
There’s a clear gap between what students know about personal finance literacy and what they are taught in schools or at home. Personally, I think education starts at home and parent’s kids learn from the parent’s everyday living. Oprah mentioneds in her debt diet show that people need to live more consciously and know the reason for debt and the spirit of money rather than treading just above water to keep up with the Joneses. If parents aren’t keeping up with financial literacy, their kids certainly will not learn from them.
Source:
Survey: Teens Lack Financial Literacy
AP Story
- Posted in : Living Below Your Means
- Author : Kyle
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