Financial Knowledge And Behavior Indicates Individuals Essay
Facts about Financial Literacy
Financial knowledge is especially important in times where increasingly complex financial products are easily available to a wide range of the population. However, empirical evidence summarized in Lusardi and Mitchell (2014) shows that about half adult U.S. residents are financially illiterate. Their computation skills and knowledge about debts, inflation and risk are not sufficient enough to let them answer evaluation questions correctly, in other words, to make financial decisions wisely.
Financial Illiterate Subgroups
While financial illiteracy is widespread, it is also concentrated among specific population, as Lusardi and Mitchell commented in their study. Financial literacy rates differ in important ways when it comes to characteristics such as age, gender, education level, and income. Young and old…