FINANCIALSERVICES REVIEW, 7(2): 107-128 ISSN: 1057-0810

Copyright© 1998 by JAI Press Inc. All rights of reproduction in any form reserved.

An Analysis of Personal Financial Literacy Among College Students
H a i y a n g C h e n and Ronald P. V o l p e

This study surveys 924 college students to examine their personal financial literacy; the relationship between the literacy and students' characteristics; and impact of the literacy on students' opinions and decisions. Results show that participants answer about 53% of questions correctly. Non-business majors, women, students in the lower class ranks, under age 30, and with little work experience have lower levels of knowledge. Less knowledgeable students tend to hoM wrong opinions and make incorrect decisions. It is concluded that college students are not knowledgeable about personal finance. The low level of knowledge will limit their ability to make informed decisions.



The ability to manage personal finances has become increasingly important in today's world. People must plan for long-term investments for their retirement and children's education. They must also decide on short-term savings and borrowing for a vacation, a down payment for a house, a car loan, and other big-ticket items. Additionally, they must manage their own medical and life insurance needs. Unfortunately, studies have shown that Americans have inadequate knowledge of personal finances (EBRI, 1995; KPMG, 1995; PSRA, 1996, 1997; Oppenheimer Funds/Girls Inc., 1997; Vanguard Group/Money Magazine, 1997). They fail to make correct decisions because they have not received a sound personal finance education (HSR, 1993; Hira, 1993; O'Neill, 1993). This study has three purposes. First, it provides evidence of personal finance literacy among college students. Second, it examines why some college students are relatively more knowledgeable than others. The analysis may help us identify factors that determine the level of competency possessed by college students. The third purpose is to examine how a student's knowledge influences his/her opinions and decisions on personal financial issues.
Haiyang C h e n • Professor of Finance, The Williamson College of Business Administration, Youngstown State University, Youngstown, Ohio 44555; Phone: (330) 742-1883; Fax: (330) 7421459; E-mail: Ronald P. Volpe • Professor of Finance, The Williamson College of Business Administration, Youngstown State University, Youngstown, Ohio 44555.




The paper is organized as follows. Section II reviews previous studies on financial literacy. Section III discusses methodology. Section IV presents results. Section V concludes the paper.



Most of the previous studies are conducted by practitioners in the financial service industry. They focus on money management and investment-related issues. This emphasis is consistent with findings of the Certified Financial Planners, indicating these issues are important areas of personal financial planning (NEFE, 1993-1996). The results of these studies show that the participants generally answered fewer than 60% of survey questions correctly. Prior studies of high school students consistently find that they are not receiving a good education in personal financial fundamentals and have poor knowledge (Bakken, 1967; CFAJAMEX, 1991; HSR, 1993; Langrehr, 1979; NAEP, 1979). In a recent study of 1,509 high school seniors from 63 schools, Mandell (1997) reports an average correct score of 57% in the areas of income, money management, savings and investment, and spending. His conclusion is that students are leaving schools without the ability to make critical decisions affecting their lives. Do adults have a good command of personal finance and investments? Results of several studies suggest that they do not. Princeton Survey Research Associates (1997) surveys 1,770 households nationwide on their financial knowledge and find an average correct score of 42%. This result shows that household financial decision makers do not have a good grasp of basic finance concepts. In another study of 522 adult women, 56% are found not very knowledgeable about investing (Oppenheimer Funds/Girls Inc., 1997). Workers do not save adequately for retirement and make investment decisions that are too conservative. A KPMG (1995) survey of 1,183 employers finds employees contribute only about 5% of their income to 401K plans, although the typical plan allows a 14% contribution. The evidence indicates that employees are not maximizing their benefits. Additionally, the low savings rate and the low return from conservative investments may not provide enough income for a financially secure retirement. Employee Benefit Research Institute (1995) provides further evidence that most Americans do not save sufficient retirement funds and may have a false sense of financial confidence and security. The study surveys 1,000 current workers and retirees on financial knowledge issues. About 71% of all workers and 81% of retirees score 60% or less. The Institute of Certified Financial Planners (1993) surveys 123 Certified Financial Planner licensees and finds that financial illiteracy is a major problem when it comes to making individual financial decisions. Poor knowledge of investment fundamentals is the most common problem encountered by their clients. The results of two national surveys suggest that investors do not have a solid knowledge of investment issues. Princeton Survey Research Associates (1996) interviews 1,001 investors and finds that only 18% of them are financially literate. Vanguard Group/Money Magazine (1997) survey 1,467 mutual fund investors at 59 shopping malls across the country. The average correct score on a 20-question quiz is approximately 45%.

insurance. (2) 60% to 79%. record keeping. and insurance. 1996). The third category represents a relatively low level of knowledge. 1987. The responses from each participant are used to calculate the mean percentage of correct scores for each question. For example. The survey participants are asked to answer 52 questions including 36 multiple-choice questions of their knowledge on personal finance. Many studies cover selected areas in personal finances. They survey 454 students from a state university in the Midwest and find that the average correct score of the participants is 44%. Chen. These limitations are compounded by the fact that many prior studies only report the levels of financial literacy without analyzing the factors that influence people's knowledge. and eight questions on demographic data. section. The second category represents a medium level of knowledge. While the prior research has provided evidence of people's personal finance knowledge and improved our understanding of the issue. and (3) below 60%. Volpe. and overall financial management. A copy of the questionnaire can be found in the Appendix. the mean percentage of correct scores is grouped into (1) more than 80%. Furthermore. the validity of the survey instruments is questionable because of the limited number of items included in the questionnaires. Previous research suggests that levels of financial literacy vary among subgroups of students (Volpe. The survey is used in a pilot study to refine the instrument. The validity and clarity of the survey are further evaluated by two individuals who are knowledgeable in personal finance. Chen. suggesting that they have inadequate knowledge. and Pavlicko (1996) focus on knowledge of investment. and business majors are more knowledgeable than non-business majors. III. METHODOLOGY This study uses a comprehensive questionnaire designed to cover major aspects of personal finance. Volpe. They also find that males know more about insurance and personal loans. Consistent with the existing literature (Danes & Hira. 1996). & Pavlicko. Danes and Hira (1987) survey 323 college students from Iowa State University using a questionnaire covering knowledge of credit card. personal loans. Married students generally are more knowledgeable about personal finance. None of the previous studies have examined how an individual's knowledge impacts their opinions regarding personal finance issues and financial decision making. but females know more about issues covered in the section of overall financial management knowledge. eight questions of their opinions and decisions. and Pavlicko (1996). The quality and consistency of the survey are further assessed using Cronbach's alpha. and the entire survey. savings and borrowing. Few of them have examined college students except for Danes and Hira (1987) and Volpe. insurance. This study provides further evidence of the dif- . and investments. it suffers from several weaknesses. The first category represents a relatively high level of knowledge. It includes financial literacy on general knowledge. neglecting others. Chen.Financial Literacy 109 Most published studies focus on financial literacy among high school students and adults. Chen. They find that the participants have a low level of knowledge regarding overall money management. credit cards. both studies on college students use samples from a single university. & Pavlicko. They also find that male students are more knowledgeable than female students.

This dichotomous variable is then used in the logistic regression as the dependent variable. 0 otherwise. 1 if the participant is a male. EXPERIENCE3 = EXPERIENCE4 = AGE1 AGE2 = = . Students with scores equal to or below the median are classified as students with relatively less knowledge. gender. 0 otherwise. 1 if a participant is a senior. The logistic model takes on the following form: log [ p / ( 1 -p)] = B 0 + B I ( M A J O R ) + B2(CLASSRANK1 ) + B3(CLASSRANK2 ) + B4(CLASSRANK3) + Bs(CLASSRANK4) + B6(GENDER) + BT(RACE1) + Bs(RACE2) + B9(RACE3) + Blo(RACE4) + B 11(NATIONALITY) + BI2(EXPERIENCE1) + BIa(EXPERIENCE2) + BI4(EXPERIENCE3) + B15(EXPERIENCE4) + BI6(AGE1) + BI7(AGE2) + B18(AGE3) + B19(INCOME1) + B2o(INCOME2) + B21 (INCOME3) + e i (1) where P MAJOR CLASSRANK1 CLASSRANK2 CLASSRANK3 CLASSRANK4 GENDER RACE1 RACE2 RACE3 RACE4 NATIONALITY EXPERIENCE 1 EXPERIENCE2 = = = = = = = = = = = = = the probability of a student who is more knowledgeable about personal finance. 0 otherwise. The coefficients represent the effect of each subgroup compared with a reference group. 0 otherwise. 0 otherwise. 0 otherwise. work experience. 0 otherwise. The differences are further analyzed using logistic regression models. 1 if a participant is White. 0 otherwise. 1 if a participant is Hispanic. which is arbitrarily selected. 0 otherwise. 1 if a participant is a junior. The participants are classified into two subgroups using the median percentage of correct answers of the sample. age. nationality. 1 if a participant is African American. 1 if a participant is a freshman. 1 if a participant is a sophomore. race. The reference category is a business major. 1 if a participant has 2 to less than 4 years of experience. 0 otherwise. 1 if the participant is a foreign student. 0 otherwise. 0 otherwise. which is explained simultaneously by all of the independent variables. and income. The independent variables used in the logistic regression are variables such as academic discipline. 1 if a participant is in the age group of 18-22. 0 otherwise. 0 otherwise. If the logistic coefficient of the variable is negative. For example. 1 if a participant has 4 to less than 6 years of experience. 1 if a participant is in the age group of 23-29. 1 if a participant is a non-business major. 0 otherwise. the non-business majors are associated with decreased log odds ratio of being more knowledgeable about personal finance. Students with scores higher than the sample median are classified as those with relatively more knowledge. 1 if a participant is American Indian. then it means that compared with business majors. M A J O R is coded as 1 if a participant is a nonbusiness major. 1 if a participant has no experience.110 FINANCIAL SERVICES REVIEW 7(2) 1998 ferences using analysis of variance (ANOVA). 0 otherwise. class rank. 0 otherwise. 1 if a participant has more than 0 to less than 2 years of experience. 0 otherwise.

7 36.5 16.$ 4 9 . 0 otherwise.6 C. 0 otherwise.3 23. TABLE 1 C h a r a c t e r i s t i c s o f the S a m p l e Number of Participants A.6 D. 1 if the p a r t i c i p a n t is in the i n c o m e g r o u p o f $ 1 0 .$ 2 9 . Academic Disciplines a) Business Majors b) Non-Business Majors 2. 0 0 0 .6 5.4 6.999 c) $30. = 1 if the p a r t i c i p a n t is in t h e i n c o m e g r o u p o f $ 3 0 .000 to $29.0 l 1.000 or more Percentage 431 389 156 157 160 326 106 52.2 17. 0 0 0 .0 16.7 43.7 B.7 93.6 47.000 b) $10.4 22. 184 224 192 248 21.2 1.6 1.6 46.6 85.999 d) $50.4 17. 0 otherwise.3 17.2 . 32 78 134 194 384 395 289 151 69 3. Class Rank a) Freshman b) Sophomore c) Junior d) Senior e) Graduate Demographic Characteristics I. 0 0 0 . Years of Age a) 18 to 22 b) 23 to 29 c) 30 to 39 d) 40 and over Income I. 0 o t h e r w i s e . 9 9 9 .4 55.9 9. Last Year's Income a) Under $10. 1 if the p a r t i c i p a n t is in the i n c o m e g r o u p o f less t h a n $ 1 0 .7 26.Financial Literacy 111 AGE3 INCOME 1 INCOME2 INCOME3 = = = l i f a p a r t i c i p a n t is in the a g e g r o u p o f 3 0 .3 9 . Years of Work Experience a) None b) Less Than Two Years c) Two to Less Than Four Years d) Four to Less Than Six Years e) Six Years or More 2. Nationality a) USA b) Foreign (other than USA) Experience 2. 0 0 0 .6 29. 395 495 763 59 47 14 15 740 52 44. Gender a) Male b) Female Race a) White b) African-American c) Asian d) Hispanic e) Native American 3.000 to $49.7 7.0 6. Education 1.7 32.

Female participants represent about 55. One reason for the low level of knowledge is the systematic lack of a sound personal finance education in college curricula. Florida. 1987). and below 60.56%. Most participants have more than two years of work experience. the sample is partitioned into two groups of students with relatively more knowledge and those with relatively less knowledge. They are also asked to make decisions on the related financial issues. and small community colleges in California. and graduate students. Pencek. representing a response rate of 51. it is not surprising the results show that college students have inadequate knowledge on personal finance. The median percentage of correct scores is 55.85.S.7% of the students are from 18 to 29 years of age. somewhat unimportant. Massachusetts. As in the logistic regression analysis. RESULTS AND ANALYSIS The questionnaires are sent to 1. The mean percentage of correct scores is grouped into three categories: over 80. indicating on average the participants answered only about half of the survey questions correctly. therefore.6% of the sample. Since the issues are related to each section in the survey. and Pennsylvania.6% of the participants are business majors. about 52. various sample sizes have been used to calculate valid percentages in Table 1. the section median percentage of correct answers is used to classify the sample. & Zietlow. Kentucky. . and very unimportant. The reliability of the 36-question survey is 0. which is followed by lower scores within each section. Overall Results of the Survey The overall results are presented in Table 2. sophomore. main and branch campuses of large universities. The findings suggest that college students' knowledge on personal finance is inadequate. Cross-tabulations and Chi-square tests are used to determine if the difference of the two groups' opinions and decisions are statistically significant. About 75. most of the participants are white and U. The large Cronbach alpha indicates that the questionnaire is reliable. The highest score is presented first. which further increases its validity. somewhat important. not sure. Ohio. In terms of education. students are asked to rank personal finance issues using five categories: very important. A. 1993). only 5% of business school offers an undergraduate major in finance services. They include both public and private schools.800 students from 14 college campuses.87%. Thirty-six percent of the participants are seniors with the rest evenly distributed among freshman. Given the lack of personal finance education. Even business schools do not require students to take a Personal Finance Management course (Bialaszewski. Detailed characteristics of the sample are presented in Table 1. According to a survey by Gitman and Bacon (1985). Most of the higher education institutions put little emphasis on students' personal finance education (Danes & Hira. Missing responses cause the sample size to vary from 792 to 905. The overall mean percentage of correct scores is 52. IV. Nine hundred twenty-four students from 13 campuses participated in the survey.33 %. junior. In terms of demographic background. 60-79.112 FINANCIAL SERVICES REVIEW 7(2) 1998 To determine the impact of financial literacy possessed by the participants on their opinions. citizens.

16 63. and the Entire Survey Level of Personal Finance Knowledge Low Below 60% General Knowledge Personal Finance Literacy Legal Requirements for Apartment Lease Apartment Leasing Costs Asset Liquidity Spending vs.39 50.8 ! 32. Tax Deduction Mean Correct Responses for the Section Median Correct Responses for the Section II.31 33.94 48.03 73.23 23.90 34.56 .24 66.37 41.14 59.70 33.47 55.08 45.35 36.67 64.81 54.38 27. Medium 60-79% High Over 80% 80. Saving Pattern Checking Account Reconciliation Net Worth Calculation Personal Financial Planning Tax Credit vs.89 62. Savings and Borrowing Creditworthiness Consumer Credit Report Sources Deposit Insurance Checking Account Overdrafts Compound Interest Certificate of Deposit Terms Loan Co-Sign Consequences Annual Percentage Rate Credit Card Use Mean Correct Responses for the Section Median Correct Responses for the Section III. Each Section.1)9 29.11 74.Financial Literacy 113 TABLE 2 Mean Percentage of Correct Responses to Each Survey Question.35 64.Benefits of Early Investment Mutual Fund Investment Return High Risk .00 28.95 75.95 72.68 47.56 86. Insurance Auto Insurance Rate Determination Reason to Buy Insurance Health Insurance Characteristics Insurance Conflict Resolution Homeowners' Insurance Characterb ~ics Term Insurance Characteristics Mean Correct Responses for the Section Median Correct Responses for the Section IV.70 48.64 56.87 55.50 53. Investments Mutual Fund Selection Common Stock Investing for Selected Investment Goals Retirement .55 56.67 52.32 44.08 69.57 12.70 66.48 70.23 30.47 74.94 64.45 40.67 76.Return Investment Suitability Interest Rate Changes and Treasury Bond Price Municipal Bond Investment Dollar-cost-averaging Investment Diversification Mutual Fund Charges Foreign Exchange Rates Mutual Fund Ownership Characteristics Mean Correct Responses for the Section Median Correct Responses for the Section Mean Correct Responses for the Entire Survey Median Correct Responses for the Entire Survey I.49 52.38 63.

students have little experience with tax. work experience. and insurance. Insurance (59. Table 3 shows the mean percentage of correct responses for Section I (General Knowledge). no single subgroup can claim the highest scores throughout the four sections. The testing results of ANOVA indicate that the differences are statistically significant at the 0. ANOVA has been used to detect if participants from various subgroups have different levels of knowledge. A further look into the scores on individual questions shows that students score higher on issues with which they are familiar. As shown in Table 1. Although the different scores are statistically significant. Savings and Borrowing (54. This pattern persists among all sections including the overall results. The results for the entire survey clearly show that business majors are more knowledgeable than non-business majors. On average. about 44% of the participants are 18 to 22 years of age. the non-business majors.40%). and about 76% are under 30.37%). Foreign students also earn lower scores than their American counterparts. The findings also suggest that participants from different class ranks have different levels of financial knowledge. Table 3 shows participants' knowledge varies with their demographic characteristics.72% of the survey questions correctly. they are exposed to a limited number of financial issues related to general knowledge. For example. In contrast. The values of F-statistic suggest that these differences are highly significant. Participants from dissimilar ethnic backgrounds have different levels of financial knowledge. Subsequently. Section III (Insurance). B.77%) are lower than those from the male participants (57. Analysis of Results by Subgroups of the Sample In this section. term life insurance. the highest score is related to auto insurance. and junior and senior students are more knowledgeable than those from the lower ranks. The majority of them are in a very early stage of their financial life cycle. African-American participants earn the lowest scores throughout the various sections. graduate students know more than the undergraduate students.01 level.94%. These factors may explain the differences in the mean percentages of correct answers for the sections of General Knowledge (63. This pattern of business majors answering about 8% to 12% more questions correctly than non-business majors is persistent throughout the individual sections. savings and borrowing. They know more about these issues because they need to rent apartments during their college years. they earn low scores in these areas. During this period.70%). and most of investment topics. and Investment (40. Section IV (Investment).47%). Students are familiar with the issue because many of them own cars and have to pay a higher auto insurance premium. The percentages of correct answers from the female participants (50. the business majors answered 60. 49. the differences in the level of literacy among different ranks are statistically significant at the 0.114 FINANCIAL SERVICES REVIEW 7(2) 1998 Another reason for the low level of knowledge can be attributed to the young ages of the participants. most of their incomes are spent on consumption rather than investment.01 level. Section II (Savings and Borrowing). income and other demographic background are examined. and the entire survey by different subgroups. . Participants' educational background has a significant impact on their knowledge. Again. Generally. At this stage of the cycle. the relationship between personal financial literacy and participants' education. Students also score relatively high on apartment leases.24%).

81 63.66 (19. 1.98)** 42.68 53.51 37.39 b) $10.74 (11.48 42.79 63.94 56.32 F Statistic (13.28 52.68)** 61.50 F Statistic (3.91 58.49)** 31.32 (17.14 60.999 65.24 43.69 44.05)** 3.77)* 51.97 44.77)** 45.97 (29.09 52.23 53.61 56.15 63. Income 1.11)** 50.67 F Statistic (2.04 52.14 c) Two to less than four years 58. Nationality a) USA 67.53 48.00 (5.63 c) 30 to 39 61.000to $29.30 e) Six yearsor more 73.16)** 60.54 58.60)** B.58 c) $30.70)** (11.06 59.37 (12. Years of Age a) 18 to 22 60.07 (5.82 c) Asian 61.78)** 49. Academic Disciplines a) Business Majors b) Non-Business Majors FStatistic 2.62 d) $50.02 63.16 57.32)** (20.43)** 29.34)** 56.74) 39.18 48.45 58.05 level.48)** 61.62 48.12 54.89 55.20 55.66)** 46.35 (27.37 44.78 42.69 67.05)** 56.000 62.78 62.71 (6.64)** 43.38 57.48 36.64 67.77 (31.94 (103.13 41.48 63.85 59.65 34.74 53.01 level or greater.57)** D.20 61.25 36.92)** C.34 (13.56)* (6.52 48.22 63. Experience 1.13 b) Female 62.85 65. **significant at the 0.73 31.74 46.78 41.71 (0. 63.96)** (21.95)** 54.42 53.66 58.40 50.68 59.97 61.53 57.36 39.48)** 2.11 63.74 57.72 F Statistic (22.93)** 41.07 62. DemographicCharacteristics Gender a) Male 67.78 59.46 59. Class Rank a) Freshman b) Sophomore c) Junior d) Senior e) Graduate F Statistic Savings & Borrowing Insurance Investments For the Sample 72.72 49. Education 1.25 46.25 68.19 57.26)** (I 1. Years of Work Experience a) None 57.17 50. Last Year's Income a) Under $10.90 39.53) 57.82 d) Four to less than six years 65.34)** 48.74 71.71 b) Foreign (not USA) 59.58)** Notes: *significant at the 0.Financial Literacy 115 TABLE 3 Mean Percentage of Correct Responses to Each Section by Characteristics of Sample and Results of ANOVA General Knowledge A.09)** 36.08 d) 40 and over 74.45 (17.47 (30.000 to $49.40)** 63.01 b) Less than two years 57.75 58.38 40.82 55.07 49.41 (4.84)** 60.34 49.01 F Statistic (13.12 (20.83 52.91 (37.64)** (4.02 75.00 66.78 (24.55 51.73 (94.93 56.36 35.50 51.12 61.22 48.40 (2.32 b) 23 to 29 68.63 55.25 (10.47 57.999 67.01)** 54.42)** 56.05 38.22)** 45.09 63.63 50.98 (87. Race a) White 64.20 (20.67 (3.67 50.58)** 66.99 55.62 (2.69)** .96 5 i.21 51.49 e) Native American 60.97 42.68 55.79)** 2.000 or more 68.73 d) Hispanic 73.85 (33.60 b) African-American 56.72 F Statistic (7.98 42.44 51.88 (10.69 36.

the result suggests that non-business majors are more likely to be less knowledgeable about personal finance than business majors. Participants who are more senior in class rank have earned higher scores in the survey. . They are not more literate just because they are older.01 level. The differences between those with six or more years of experience and those with no experience and those with less than two years of experience are significant at the 0. it seems that participants with higher personal income answered more questions correctly than those with lower income. 71. Women participants are more likely to be less knowledgeable than men. A similar line of reasoning would apply to why the participants who are older or have more work experience earned high scores in the survey.06 levels respectively. and INCOME variables affect level of knowledge in oneway ANOVA. and INCOME are significant in the individual sections.000. seminars." Results of the logistic regression are shown in Table 4. the results from logistic regressions for the individual sections are consistent with that of the entire sample. They are regrouped into the adjacent groups of "40 and over" and "Under $10. they no longer have any significant impact in the logistic regression where all the variables are used simultaneously to explain the level of knowledge. the models have high explanatory power. The finding is not surprising because curriculum requirements of business majors give them more opportunity to take finance and related courses. the number of participants in these categories are very small. GENDER." However. Consistent with findings of ANOVA. They must have prior exposure to personal finance.47% of the observations are correctly classified as compared with 50. Participants under age 30 are more likely to be less knowledgeable as compared with those 40 or older. With few exceptions. Few coefficients of RACE. Similar patterns can be found in the individual sections. As suggested by the high Chisquare values. They learn the subject through a business course. In addition to the overall fit of the model. The result that business majors are more knowledgeable is consistent with findings of previous research. The significant negative coefficients for CLASSRANK variables indicate that participants from lower class ranks are more likely to be less knowledgeable than those from graduate classes. participants with more years of work experience are more knowledgeable than those with less experience. Similarly. Participants with less work experience have high probability of being less knowledgeable than those with more experience.116 FINANCIAL SERVICES REVIEW 7(2) 1998 In terms of participants' work experience and ages. Another widely used measure of the overall fit of the model is to examine its ability to correctly classify observations. NATIONALITY. Participants in the age subgroups of 23 to 29 and 40 or older exhibit greater knowledge than the other age groups. The survey has an age category of "60 or older" and an income category of "No income. For the entire sample. For example.03% chance classification. and AGE variables in the individual sections carry the same signs and are significant as shown for the entire sample. Finally. One explanation is that by staying in universities longer. or their own mistakes. Although the coefficient of AGE3 still exhibits a negative sign. Our view is consistent with the finding of this study that business majors are more knowledgeable than non-business majors. the business majors perform consistently better than the non-business majors in every section of the survey.07 and 0. While RACE. the difference between those who are in their thirties and forties or older is statistically insignificant. many coefficients for CLASSRANK. students will naturally pick up more about personal finance. NATIONALITY. the coefficient of MAJOR for the entire sample is negative and significant at the 0. Our argument is that students do not gain more knowledge of personal finance by just spending more time in college learning other unrelated subjects.

7166 1.4770 -0.2644 0.4145 0.0992 -0.7925 -0.7248* 0.3251 * * .1.3594 -0.03% --" -1.1772* 1.8234 -0.5337 -0.1.0899'* -0.3630* * -2.47% 50.0459 -0.0784"* -0.02% For the Sample MAJOR CLASSRANK1 CLASSRANK2 CLASSRANK3 CLASSRANK4 GENDER RACEI RACE2 RACE3 RACE4 NATIONALITY EXPERIENCE 1 EXPERIENCE2 EXPERIENCE3 EXPERIENCE4 AGEI AGE2 AGE3 INCOMEI INCOME2 INCOME3 -0.1.2985 0.1877 -0.72% 2.0381 * * .7156 .88% 50.4133** -0.1613 0.0149 0.5012* * -0. Experience.3382 0.215 66.7823* 0.6407 -0.1670 0.1107* * -0.1846 0.2234* * -0.6339 0.1491 * * .2717 * * -0.1.0320 -0.8965** .8083** -0.1.630)** 0.0620 -0.9428 0.00% 2.2873 -0.3495* .6071 ** .5615 .01 level or greater.1753"* -2.3631'* -1.0668 0.2291 -0.1628 -0.1480 0.8546 0.9402 -0.1.5516"* -1.05 level.1148"* 833.5972 -0.365 (210.3771 -0.955 (215.4667 -0.9343** -0.7044 -0.3886 -0.4867"* -1.0135 -0.64% 51.1914"* -0.650)** 0. **significant at the 0.446)** 0.5574** -1.6123 -0.2013 -1.1.1623 -0.6306** -1.165 72.1.3623 0.323 72.9326* 0.2412"* -0.2740 .4888** 842.6697* 0.TABLE 4 Logistic Regression Analysis of the Impact of Participants' Education.1.9844** -0.7995** -0.9173** -0.2138"* 924.8613 * * .51% 56.2517 -0.328 71.1664 Savings & Borrowing Investments -0.753 (134.4497 -0.4050* -0.3456 -0.3037 -0.1905 -0.9911"* .1.239 70.5209 1.1893 2.040)** 0.6778 -0.485)** 0.3096 858.9298** 0.5263 -0.9248 0.4709* -1.5661 -0.9773 899.451 (95.74% Constant -2 log Likelihood Overall Chi-Square Adjusted R 2 Correct Classification Chance Classification Notes: *significant at the 0.0573 * * -0.5379** -0.826 (150.29% 50.2280 0.6611 -0. and Income on Their Financial Literacy Estimated Coefficients and the Level of Significance for Various Sections and the Entire Sample General Knowledge Insurance -0.1515 -0.4050 - -0.6331 ** 0. .7854 . Demographic Characteristics.2644 -0.6985* -0.6862** 0.9968 1.6371 ** -0.

Number and percentage of participants who actually maintain financial records: Detailed Records No Records 20 5.835. 2.9% 125 23.001 level.1% 4 0.2% Total 406 100% 497 100% < Students with More Personal 337 Finance Knowledge 83.1% 68 13.5% Chi-Square = 7. Number and percentage of participants who view maintaining adequate financial records as: Very Important Not Sure 8 2. Z > Z B.1% 237 46.001 level.7% 11 2.8% 374 100% 530 100% Somewhat Important Total 93 24.9% 371 100% 54 I 100% Minimum Records Total 182 49.0% Students with Less Personal 336 Finance Knowledge 67.7% 39 7.7% Somewhat Important Somewhat Unimportant 2 0.6% Chi-Square = 50. significant at the 0.5% 43 8.4% 8 1.6% Somewhat Unimportant Very Unimportant Students with More Personal 260 Finance Knowledge 69.6% Students with Less Personal 149 Finance Knowledge 29.TABLE 5 oo Impact of the Participants' Financial Knowledge on Their Opinion and Behavior A.4% 128 24. General Knowledge 1.0% Chi-Square = 65.7% 9 2. Savings and Borrowing 1. significant at the 0.1% Students with More Personal 169 Finance Knowledge 45.7% Very Unimportant 3 0.903.813.5% 4 1.1% 30 5.8% Very Important 53 13. . Number and percentage of participants who view that spending less than their income is: < N t~ Not Sure 11 2.098 level.5 % Students with Less Personal 363 Finance Knowledge 68. significant at the 0.

0% 163 31.7% 410 100% 514 100% Incorrectly Total Students with More Personal 365 Finance Knowledge 89. significant at the 0. (continued) . Number and percentage of participants who choose to act on their insurance: Correctly 197 74.3% 544 82.1% Somewhat Important Somewhat Very Unimportant Unimportant Total 263 100% 641 100% Students with More Personal 145 Finance Knowledge 55.5% 265 100% 659 100% Incorrectly Total Students with More Personal 68 Finance Knowledge 25. Number and percentage of participants who view that maintaining adequate insurance coverage is: Very Important Not Sure 29 I 1. Insurance 1.7% Students with Less Personal 115 Finance Knowledge 17.2% Chi-Square -.844. significant at the 0. 1% 4 1.584 level.8% 7 1.5% Chi-Square = 8.001 level. C.020. Number and percentage of participants who choose to act on their spending: Correctly 45 11. significant at the 0.0% Students with Less Personal 351 Finance Knowledge 68.3% Chi-Square = 56. 1% Students with Less Personal 354 Finance Knowledge 55.2.1% 2 0. 2.2.5% 22 3.4% 83 31.223.005 level.6% 193 30.0% 65 I 0.

1% 14 2.8% 22 4.6% Chi-Square = 74.774.4% 360 100% 564 100% Number and percentage of participants who choose to act on their investments: Incorrectly Total Z Z t" t~ < Students with More Personal 288 Finance Knowledge 80% Students with Less Personal 291 Finance Knowledge 51. Number and percentage of participants who view planning and implementing a regular investment program is: Very bnportant Not S u r e 24 6.4% Somewhat Important Somewhat Very Unimportant Unimportant Total 358 100% 544 100% Students with More Personal 220 Finance Knowledge 61.8% Chi-Square = 52.0% 4 1. Correctly 72 20% 273 48. < .7% 115 21.001 level.. significant at the 0. 2. significant at the 0.TABLE 5 (cont.1% 10 2.5% Students with Less Personal 222 Finance Knowledge 40.001 level.9% 171 31.o 7~ o¢ . Investments 1.102.6% 100 27.) D.

deficiency in their knowledge about personal finance needs to be addressed. Analysis has also been conducted using an alternative classification scheme. For the less knowledgeable group. When asked what they would actually do. Consequencesof Having Inadequate Knowledge This section examines how a student's knowledge affects his/her opinions and decisions about some personal finance issues. The difference in opinions regarding record keeping is statistically significant at the 0. The difference in their decisions can be seen from the significant test results and the fact that a higher proportion of the more knowledgeable participants act according to their opinions and a higher proportion of the less knowledgeable participants do not. Space limitations do not allow a comprehensive analysis of why women are less knowledgeable than men. In addition. Martinez. Chen.039 level. Students with section scores equal to or higher than the median are classified as those with more knowledge. In terms of insurance. HSR. The sample is partitioned into two groups by each section's median score. Students with scores equal to or below the median are classified as those with relatively less knowledge. The results are similar to what have been reported above. about 92% view keeping records as important. missing observations cause the total sample size to vary from 903 to 924. Lewin. Students with section scores higher than the median are classified as those with relatively more knowledge. About 95% of the participants from the more knowledgeable group rank keeping records as very important or somewhat important. and the rest of them believe otherwise.3%). insurance. The Chisquare tests suggest that the differences in opinions and decisions are highly significant. Yet given the fact that more and more women are joining the work force and they are expected to live longer than men. compared to 68. 1995. ). about 45. The difference in opinions is not significant. 1994. more than 80% of the participants from both groups rank maintaining adequate insurance coverages as important. 1996. C.Financial Literacy 121 The finding that women score lower than men is consistent with the existing literature (Genasci. The results for savings and borrowing. & Pavlicko. When provided with a hypothetical situation of a spending decision. 1993. 89% of the more knowledgeable participants select the correct choice. The difference in their decisions is significant at the 0.1%) rank spending less than their income more important than the less knowledgeable group (81.3% of the less knowledgeable group.4% for the more knowledgeable group. About 25% of the less knowledgeable group keep no records at all. 1997.098 level. Goldsmith & Goldsmith. The more knowledgeable participants (96. . more participants from the more knowledgeable group act correctly than the participants from the less knowledgeable group. Participants' responses to the importance of keeping financial records are reported in Part 1 of Section A of Table 5 and what they actually decide to do in everyday life in Part 2. However. and those with scores below the median as those with less knowledge. 1995.6% of students with more knowledge keep detailed financial records and only 29% of the less knowledgeable group are willing to keep such records. There is a statistically significant difference in behavior between the two groups. The difference in opinions is significant at the 0. and investment are similar to findings to be reported below. This classification scheme makes the sample size in the more knowledgeable group larger than that of the less knowledgeable group.001 level. the classification scheme changes the number of observations in the two groups from section to section. Since many students' scores are equal to the median scores. Volpe. while the number is 5.

80% of the knowledgeable participants choose the correct action. In the case of insurance. where on average the participants answered about 40% of the questions correctly. It is also found that participants with less knowledge tend to hold wrong opinions and make incorrect decisions in the areas of general knowledge. The authors are responsible for all remaining errors. Without adequate knowledge. the less knowledgeable participants are more likely to act incorrectly. in the lower class ranks. Both the differences in the opinions and decisions are highly significant. when offered an investment situation. By far the weakest area is investment. Although the questions included in the survey are fairly basic. and have little work experience.4% of the more knowledgeable group view planning and implementing a regular investment program as important. savings and borrowing. V. S U M M A R Y AND C O N C L U S I O N This study surveys 924 students from multiple universities across the country to examine college students' knowledge of personal finance. the findings of this study suggest that there is a systematic lack of personal finance education in our education system. savings and borrowing and investments. and the consequences of having inadequate knowledge. they are more likely to make mistakes in the real world. Not surprisingly. Lower levels of financial literacy are found among subgroups. but the number is about 72. more participants from the less knowledgeable group make the wrong choices. The authors also appreciate comments from three anonymous reviewers. While there is little difference in their opinions regarding insurance. The predictive ability of personal finance knowledge shows that improving college students' knowledge is important. The above analysis suggests that the level of finance knowledge tends to influence people's opinions and affect their decisions. This challenging issue needs to be addressed. They include those who are non-business majors. gender. the relationship between the financial literacy and participants' characteristics such as academic discipline. The lack of education has resulted in serious financial illiteracy found in the American public. Together with evidence provided by the research conducted in the past three decades. Financial supports were provided by grants from the University Research Council at Youngstown State University.2% for the less knowledgeable group. a statistical difference cannot be detected in their opinions. The illiteracy and its costly consequences have made individuals worry about their finances to the extent that their productivity in workplaces is affected (CHRGI. and investments are above 65%. 1995). it becomes a problem for the society. the overall mean of correct answers for the survey is about 53%. . and discussant and participants at the 1997 Academy of Financial Services Meeting where an early version of the paper was presented. When individuals cannot manage their finances. and only 51% of the other group. The incompetency will limit their ability to make informed financial decisions. and experience. women. Results suggest that college students need to improve their knowledge of personal finance. insurance. under age 30. However. Our conclusion is that college students are not knowledgeable about personal finance. Acknowledgments: The authors are grateful to Karen Eilers Lahey (Editor) for her suggestions.122 FINANCIAL SERVICES REVIEW 7(2) 1998 Section D shows that about 89. None of the mean scores for each area of general knowledge.

B. a car. is a $500 tax credit per child or a $500 tax deduction per child more valuable to you? A. the difference between your expenditures and income.Financial Literacy 123 APPENDIX Survey of Personal Financial Literacy Thank you for participating in our survey. examining your investment portfolios to maximize returns. 1. I. C. developing a sound yearly budget of expenses and income. B. C. a house. Security deposit retained by the landlord for damages to property beyond normal wear and tear 8. If you signed a twelve month lease for $300/ month but never occupied the apartment. you legally owe the landlord A. Your net worth is A. the difference between your cash inflow and outflow. 2. . E. LEDGE Personal finance literacy can help you A. none of the above. B. B. please make sure that question numbers and answers correspond directly with those on the answer sheet. This survey is intended to measure college students' knowledge o f personal finance. Personal financial planning involves A. D. i s not a cost of leasing an apartment. You are not overspending if A. 6. learn the fight approach to invest for your future needs. E. C. B. D. your fwst month's rent of $300. money in a certificate of deposit account. C. the difference between your liabilities and assets. you meet your minimum monthly credit card payments. C. your monthly debt payment is 30% of your take-home pay. B. D I R E C T I O N S : Please use a #'2 lead pencil to mark your responses on the enclosed answer sheet. 4. a computer. C.600. E. GENERAL PERSONAL FINANCE KNOWE. 5. you write checks for more than what you have in your checking account. A. the difference between your bank borrowings and savings. buy the fight kind of insurance to protect you from . D. C. Security deposit B.catastrophic risk. B. 3.000. D. 7. Assume you have dependent children. lead a financially secure life through forming healthy spending habits. Medical expenses of your friend who fell and broke his arm on the icy pavement E. Expenses incurred for non-compliance of lease terms D. E. A $500 tax deduction. your twelve month's rent of $3. The most liquid asset is A. E. your monthly wages are $500 and credit charges $1. The results will be used to help students improve their knowledge and colleges improve curriculums. avoid being victimized by financial scalns. After completing the survey. establishing an adequate financial record keeping system. Monthly rental payment C. minimizing taxes and insurance expenses. you frequently receive calls from collection agencies. Depends on the number of children you have. A $500 tax credit. D. D. money in a checking account. Depends on your tax bracket. your security deposit. Please select only O N E most appropriate answer for each question. They are the same. do all of the above. Please make marks that fill the circle. preparing plans for future financial needs and goals.

showing no record of personal bankruptcies in recent years. B. donating money to charity. C. 12. B. B. All of the above. 14.000 no matter how the interest is computed. D. B. will result in fines. Your savings accounts in a federally insured commercial bank are insured by A. You will improve your creditworthiness by A. C. An overdraft A.000 dollar check when you have $500 in your account. D. FDIC to the maximum amount of $50. A credit card company will not charge you interest if you pay off the entire balance by the due date. D. You cannot spend more than your line of credit. E.000 today at 4 % for a year. 15. B. D. 18. higher if the interest is compounded daily rather than monthly. E. C.124 FINANCIAL SERVICES REVIEW 7(2) 1998 D. Which of the following statements is TRUE about the annual percentage rate (APR)? A. higher if the interest is compounded quarterly rather than weekly. SLIC to the maximum amount of $100. B. subtracting outstanding checks to your checkbook balance to determine if your checks have been properly processed. APR is expressed as a percentage on an annual basis. a professor. Which of the following investments requires that you keep your money invested for a specified period or face an early withdrawal penalty? A. interest is charged on the unpaid balalnce of $700. E. B. II. E. Certificate of deposit. FNMA to the maximum amount of $100. You can receive your credit report from A. 16. C. C.000 per account. then A. Checking account that pays interest. C. none of the above. a credit bureau. a credit union. Checking account reconciliation involves A. D. If your credit card balance is $1. . Money market mutual fund. APR takes into account all loan fees. $1. C. nothing.000 per account.000 per account. D. If you invest $1. C. 17. E. it means that your friend cannot receive the loan by himself. FDIC to the maximum amount of $100. you become responsible for the loan payments if your friend defaults. YOUR SAVINGS AND BORROWING 10. whatever the landlord requires. your balance in a year will be A. D. reconciling current bank statement with the previous m o n t h ' s statement to determine if there are errors. balancing bank statement with your checkbook records to determine if there are errors. B. the Better Business Bureau. APR is the actual rate of interest paid over the life of the loan. E. visiting your local commercial bank. borrowing large amounts of money from your friends. Passbook savings account. Which is FALSE concerning credit cards? A. B. E. E. B o t h A a n d C . is a stop-payment order written by the payee. Government savings bond. C.000. B. adding outstanding checks to your checkbook balance to improve your credit standing. 9.040 no matter how the interest is computed. $1. E. paying cash for all goods and services. The rate of interest on your credit card is normally higher than you can earn on a certificate of deposit. You can use your credit card to receive a cash advance. higher if the interest is compounded yearly rather than quarterly. 11. a commercial bank. 13. D. SIPC to the maximum amount of $10. D. All of the above. E. occurs when you write a $1.000 and you pay $300.000. APR is a good measure of comparing loan costs. If you co-sign a loan for a friend.

you are normally covered for pre-existing conditions. C. A mutual fund is an investment corporation that raises funds from investors and purchases securities. The main reason to purchase insurance is to A. A high-risk and high-return investment strategy would be most suitable for A. D. The main reason to purchase insurance is to A. Flood D. 24. state level. A. complex calculations of risk and return. E. E. A term insurance policy is the least expensive form of life insurance. D. . you have a right to tell fund managers what securities to buy. After buying health insurance. 22. W a r B. protect you from small incidental losses. E. you are entitled to receive part of the loan. Your ownership in a mutual fund is proportional to the number of shares you own in the fund. provide you with excellent investment returns. You have a better chance to choose doctors with a health maintenance organization rather than with a traditional health care insurance company. Term insurance is an excellent investment vehicle. remain the same. C. increase. would not ordinarily be covered under a homeowners policy. E. A mutual fund is a diversified collection of securities used as an in vestment vehicle. D. protect you from sustaining a catastrophic loss. Which of the following statements is FALSE? A. B. None of the above. selling securities to minimize capital 29. buying low and selling high. B. all of the above. a middle-aged couple needing funds for their children's education in two years. B. All of the above 23. none of the above because they are equally risk averse. YOUR INSURANCE 19. C. Your being sued by someone for slander E. protect you from a loss recently incurred. IV: YOUR INVESTMENTS 25. county level. 20. 21. A policy purchased by the individual is cheaper than one purchased through a group. C. federal level. decrease. B. BothAandC. D. record of accidents. 30. If interest rates rise. B. township level. D. D. all of the above because they all need high return. As shareholders of a mutual fund. C. C. E. C. None of the above. Most policies contain deductible and coinsurance clauses. E. an elderly retired couple living on a fixed income. Which of the following is FALSE? A. type and age of vehicle. be impossible to predict. E. 125 III. a young married couple without children. Earthquake C. 26. C. Both A and B. improve your standard of living by filing fraudulent claims.Financial Literacy C. C. E. B. age of insured. B. B. You receive no benefits when your terminsurance policy expires. E. Auto insurance companies determine your p r e m i u m based on A. completion of a driver education course. B. You have a better chance of resolving a complaint against an insurance company by bringing the issue to a government agency at the A. D. A dollar-cost-averaging approach to investing involves A. A level-term policy guarantees a fixedpremium over the life of the contract. A decreasing-term policy reduces coverage over time. D. None of the above. the price of a Treasury bond will A. D. trade at a premium.

42. 60 or older C. Sophomore E. lower if the dollar's value rises against that of the Japanese Yen. higher if the dollar's value rises against that of the Japanese Yen. ABOUT YOURSELF What is your class rank? A. B. Maintaining adequate financial records. Save money in certificate of deposit a~2ounts. E. Graduate C. . A B Very Somewhat Important Important 41. Keep the same spending pattern as in the past. 23-29 E. D. 44. B. 32. C. American Indian American E. impossible to determine if exchange rate changes between Yen and dollar. DECISIONS. Female 48. interest earned on bonds in the fund. You would buy flight insurance each time you travel by air. AND EDUCATION Assume you're in your early twenties and you would like to build up your nest egg for a secure retirement in 30 years. Freshman D. D. are not charged with sales commissions. all of the above. AfricanD. You would buy a life insurance policy from an insurance agent.126 FINANCIAL SERVICES REVIEW 7(2) 1998 31. Start to build up your savings account at a federally insured bank. E. Assuming you are in your early twenties without any dependents. B. Spending less than your income. B. dividends from common stock in the fund. You will pay $600 per month for five years for student loans. 38. U. If other factors remain the same. lowing would you do regarding your life insurance? A. 36. unchanged if the Japanese Yen's value rises against that of dollar. interest earned on cash in the fund. White C. E. You have a monthly balance on each of your three credit cards. C. What is your age? A. dollar value of a J a p a n fund will be A. Planning and implementing a regular investment program. Maintaining adequate insurance coverage. E. You have just graduated from college and found a job earning $28. Maintain minimal records. Using the scale given below please rank the importance of items numbered from 41 to 44. D. Accumulate money in a safe-box rented from a local bank. Eliminate debt by filing personal bankruptcy. C. believe that the funds have no management charges.000 per year. Junior 46. You would buy a cash value insurance policy. C. What is your sex? A. B. Which of the following approaches would best meet your needs? A. The returns from a balanced mutual fund include A. Maintain very detailed records. Put monthly savings in a diversified growth mutual fund. Hispanic B. 39. You probably do not need to buy any life insurance policy.S. What is your race or ethnic background? A. D. 40. B. can avoid the funds' administrative expenses. No-load mutual funds are recommended over load funds because investors A. Do you maintain financial records? A. Asian VI. capital gains from stocks and bonds in the fund. C. Apply for a consumer loan for a new car. Use your credit card to pay for a vacation in the Bahamas. V: YOUR PERSONAL FINANCE OPINIONS. 40-59 B. Cut expenses and use your savings to pay down debt. E. Maintain no records. 45. Senior B. which of the fol. D. Invest in long-term Treasury bonds. lower if the Japanese Yen's value rises against that of dollar. C. Male B. 18-22 D. can reduce their tax liability. do not pay for 12b-I fees. 37. 30-39 47. 43. C Not Sure D Somewhat Unimportant E Very C. What should you do to improve your financial health? A. You would buy a term insurance policy. B. D. E.

Money management understandings of tenth grade students. (1995) Latest workplace issues survey. L. $50. Business B. (1993).999.. Under $10. please write down your address.C. 36. Finance requirements and computer utilization at AACSB accredited schools.. Washington.. W. Bialaszewski.000 or more. However. (1967). State. K. (1985). P. Comprehensive personal financial planning: An emerging opportunity. Liberal Arts D. Women and retirement: An unpleasant surprise: You're retired and broke. 6.$29. $30. D. 17(1). National Business Education Quarterly. (1995). Danes. Are you a foreign sutdent? A. D.999. Chicago. internship. REFERENCES Bakken. Cambridge Human Resource Group Inc.. (1987. Money management knowledge of college students. C. Fall. IL. Employee Benefit Research Institute (EBRI). DC. What is your major field of study? A. etc. . & Hira. and Zip THANK YOU FOR YOUR PARTICIPATION. R. Gitman. (1991). Are workers kidding themselves? Results of the 1995 Retirement Confidence Survey. & Zietlow. p. B5. December.Financial Literacy 51. Pencek. Washington.000 E. (CHRGI). Six years or more 127 49. Education C. None B. The Journal of Student Financial Aid. B. No C. Two to less than 4 years D. J. Four to less than 6 years E. T.000-$49. Sciences or Engineering E. to comply with Youngstown State University's policy of human subject research. & Bacon. S. Four to less than 6 years E. September 18). Six years or more VII. (1995. INFORMED CONSENT FORM As we explained in the cover letter. Student consumer knowledge: Results of a national test. Yes B. Anonymity will be kept throughout the survey. 4-16. The Vindicator. Consumer Federation of America and American Express Company (CFAJAMEX). Genasci. J. Which best describes your or your family's personal income last year? A.000 . No income D. Financial Practice and Education. M. Journal of Financial Education. How many years of working experience do you have? Include full. 133-139. L. If you would like to receive a copy of your personal finance intelligence report and summary of this research project. Two to less than 4 years D. we would like to ask you to sign or initial below to verify that your participation is voluntary. Fall. 36-46. $10. summer jobs. A. 50. Winter). co-op.or part-time experience. T. My participation is voluntary. Others 52. the purpose of this survey is to help you improve personal finance literacy. Street address City. Less than 2 years C.

The New York Times. Income gaps for sexes is seen wider in retirement. January.C. (1995). Psychological Report. June. Denver. P. Institute of Certified Financial Planners (ICFP). April. Financial literacy of mutual fund investors. R. March/April. Financial Practice and Education. Fall/Winter). Personal financial survey of high school seniors. NY. (1993). Volpe. 236-238. Retirement benefits in the 1990s: 1995 survey data. New York. Why women should save and plan more. (1995. R. Langrehr. Gender differences in perceived and real knowledge of financial investments. November. (1997. Jump Start Coalition for Personal Financial Literacy. Investor knowledge survey. O'Neill. (1997). NY. Teenage consumers: A profile. T. Princeton Survey Research Associates (PSRA). 80. CO. D. 20). May. D. January/February). D. HRMagazine. Denver. N. Mandell. NY. . (1994). New York. National Endowment for Financial Education (NEFE). Princeton Survey Research Associates (PSRA). & Goldsmith. 41-53. consequences. and potential for change. CO. E.. NY. Planners say financial illiteracy plagues Americans: Inability to plan and poor understanding of investments cited. NJ. CO. Denver. Girls. Hira. W. M. Washington. Washington. Princeton. & Pavlicko J. (1979). National Assessment of Educational Progress (NAEP). 13. 104105. New York. Vanguard Group/Money Magazine.C. (1996. VA. Personal investment literacy among college students: A survey. Investor Protection Trust. Planning for the future: Are Americans prepared to meet their financial goals? Nations Bank~Consumer Federation of America. Consumer education: Does it change students' competencies and attitudes? The Journal of Consumer Affairs. E. Assessing America's financial IQ: Reality. Financial management knowledge and practices: Implications for financial health. Paper presented at the Personal Economic Summit '93. Martinez. (1993). (1997. (1993). F.. 6(2). money and independence. (1996).C. CFP Survey of trends in financial planning. (1993). (1997). KPMG Peat Marwick LLP (KPMG). Arlington. Oppenheimer Funds/Girls Inc. Washington. A19. (1993-1996). H. T. L. New York. J. (1979). Lewin. Liberty financial young investor survey. Harris/Scholastic Research (HSR). p. 86-94. B. (1997).128 FINANCIAL SERVICES REVIEW 7(2) 1998 Goldsmith.. Chen. Paper presented at the Personal Economic Summit '93. March).

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