FINRA (Financial Industry Regulatory Authority) released findings from the National Financial Capability Study last month and found that, while overall Americans are feeling less financial stress, making ends meet is still a daily struggle for millions of households—a struggle that keeps people from setting and achieving their long-term financial goals.
The study measured four areas of financial capability; making ends meet, planning ahead, managing financial products, and financial knowledge and decision making.
Only 37% of respondents were rated as having a high level of financial literacy (meaning they were able to correctly answer at least four of the five financial literacy quiz questions). That’s a five percent drop from the 2009 study. Basic financial literacy is critical to helping consumers understand the effect of financial choices today on one’s financial plan and future.
The study also found that one in five Americans have unpaid medical debt and 54% of people either break even or spend more than they take in each month. It’s not surprising then, that half of respondents reported having no rainy day fund. A rainy day fund helps families stay afloat when hit with unexpected expenses or interruptions in income.
How Do You Stack Up? Take The Financial Literacy Quiz
Take the financial literacy quiz FINRA put together for the study and compare your score with averages in your area and across the country. And if you’re ready to get on track with your savings and investment goals, use our proposal request tool to find and connect with the right financial advisor for you.