Are you financially literate?

According to recent research, financial literacy declines with age, on average.  The research was published through a working paper by Annamaria Lusardi, an economist at Dartmouth College.

When asked to perform a simple compound interest calculation, a group of 51-56 year-olds were puzzled.  Less than one in five could arrive at the correct answer.  (question and answer can be found at the bottom)

Other interesting and perhaps surprising findings of the study include:

  • Those 23 to 28 years old are generally more financially literate than other age groups.
  • Women are more likely to give wrong answers or say they don’t know the answer to financial literacy questions.
  • Germany, the Netherlands, Sweden and Switzerland were generally the highest performing in the financial literacy tests conducted by Annamaria.

Question used in the study:  “If you have $200 in a savings account and it earns 10 percent interest per year, how much will you have in the account at the end of two years?”
Answer: $242


The information in this material is only as current as the date indicated, and may be superseded by subsequent market events or for other reasons. While all information prepared in this document is believed to be accurate, any statements of opinion constitute only current opinions of Payne Wealth Partners, Inc., which are subject to change and which Payne Wealth Partners, Inc. does not undertake to update. Accordingly, you should not put undue reliance on these statements. The information does not attempt to examine all the facts and circumstances that may be relevant to an individual’s financial needs. Payne Wealth Partners, Inc. is not soliciting any action based on these statements.

Contact Our Offices

Payne Wealth Partners, Inc.
Keystone Financial Consulting
601 N Cross Pointe Blvd
Evansville, IN 47715
Phone: 812-477-6221
Toll Free: 888-477-6221
  • YouTube
  • Follow us on twitter
  • Follow us on facebook
  • Follow us on linkedin
  • GooglePlus

FREE Financial Planning Guides and other exclusive content!

Get instant access to download all our current - and future - informational whitepapers and guides plus join our mailing list to receive the latest Payne Wealth blog posts. 

SUCCESS! Please check your e-mail inbox for your access link and password.