Retired for how long? Worker expectations for how long they’ll live in retirement

How long will you live in retirement? Individuals can’t answer this question with certainty because they don’t know how long they’ll live in general, and this makes planning and preparing for retirement inherently difficult. However, individuals have expectations about how… Read More »

Assessing Financial Literacy Among the Young

Personal Finance Education in the Classroom

HEFWA Executive Leadership Forum on Financial Wellness | July 2024

Assessing Financial Literacy Among the Young

Abstract: Since 2012, the Programme for International Student Assessment (PISA), an initiative of the Organisation for Economic Co-operation and Development (OECD), conducted triennial tests to evaluate the financial literacy of 15-year-old students in various countries. These data provide an opportunity… Read More »

Financial Literacy and Retirement Fluency: New insights for improving financial well-being

The TIAA Institute-GFLEC Personal Finance Index (P-Fin Index), now in its eighth year, annually assesses financial literacy among U.S. adults and examines the relationship between financial literacy and financial well-being. In addition to a robust measure of overall financial literacy,… Read More »

Financial literacy and financial education: An overview

Abstract: This article provides a concise narrative overview of the rapidly growing empirical literature on financial literacy and financial education. We first discuss stylized facts on the demographic correlates of financial literacy. We next cover the evidence on the effects… Read More »

Evaluating the Effects of a Low-Cost, Online Financial Education Program

Abstract: This paper provides evidence on how a low-cost, online, and scalable financial education program influences older participants’ financial knowledge. We tested the program using a field experiment that included short stories covering three fundamental financial education topics: compound interest,… Read More »

An unrecognized barrier to retirement income security: Poor longevity literacy

Longevity literacy is an understanding of how long people tend to live upon reaching retirement age. It is particularly important since retirement income security requires planning, saving, and preparing for a period that is uncertain in length. Unfortunately, data from… Read More »

ESG Knowledge and Interest: A study among Householders in 8 countries

Abstract: In this study, we surveyed over 16,000 respondents in eight countries to collect information on individuals’ preferences for sustainable investing, ownership of ESG investment products, as well as their level of financial literacy, investing sophistication and understanding of topics… Read More »

Financial Literacy and Personal Finance – An Overview

Financial literacy, longevity literacy, and retirement readiness: The 2022 TIAA Institute-GFLEC Personal Finance Index

Six years of data from the TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) clearly demonstrate that U.S. adults with greater financial literacy tend to have better financial well-being. This report shows that retirement readiness, a specific realm of financial well-being,… Read More »

How financial literacy varies among U.S. adults: The 2022 TIAA Institute-GFLEC Personal Finance Index

Summary: The TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) is an ongoing project now in its sixth year that annually assesses financial literacy among the U.S. adult population. The P-Fin Index is unique in its capacity to produce a robust… Read More »

Millennials’ and Gen Z’s Money Management During COVID-19: Challenges and Opportunities

Abstract: The economic consequences of the COVID-19 pandemic have not been felt equally among individuals, with millennials and Gen Z among those hit hardest. We examine responses to a novel survey conducted in May 2021 to understand how the pandemic… Read More »

Financial literacy and well-being in a five generation America: The 2021 TIAA Insitute-GFLEC Personal Finance Index

Summary: With five years of the Gen Z cohort now over age 18, the U.S. adult population spans five generations. This report uses data from the 2021 TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) to compare financial literacy across the… Read More »

Examining the Barriers to Annuity Ownership for Older Americans

Abstract: The annuity take-up rate is lower than economic theory predicts.1 Using data from the 2018 National Financial Capability Study, we conduct an empirical analysis of individuals in the retirement-planning phase of the life cycle (ages 40–61) and individuals of… Read More »

Coping with new (and old) vulnerabilities in the post-pandemic world

The symposium concludes the work programme carried out by the Global Partnership for Financial Inclusion (GPFI) under the Italian G20 Presidency. It aims to take stock of the main experiences gained in financial education and consumer protection, including during the… Read More »

Financial Anxiety and Stress Among U.S. Adults: New Evidence From a National Survey and Focus Groups

Summary: The economic impact of the COVID-19 pandemic has shed light on the deeply rooted financial insecurity that many Americans face. Our research shows that even before the pandemic hit, and at a time of economic expansion, a large share… Read More »

Financial Resilience in America

Summary: In this report, we examine the concept and assessment of financial resilience and its associated factors, which include income and cash flow management, debt management, risk protection, and financial literacy. We use longitudinal data from before and after the… Read More »

How to Strengthen Household Financial Resilience

Introduction: The COVID-19 pandemic and its economic consequences have laid bare the deeply rooted financial insecurity many Americans face daily. Many households are highly dependent upon earned income and have little to buffer an income loss due to business shutdowns… Read More »

Factors Contributing to Financial Well-Being among Black and Hispanic Women

Abstract: This article provides an in-depth examination of the financial well-being of Black and Hispanic women and the factors contributing to that well-being, using the 2018 survey wave of the National Financial Capability Study. The article documents meaningful differences between… Read More »

Financial Literacy and Financial Behavior at Older Ages

Abstract: Recent research has documented that people are increasingly entering old age holding more debt than ever before, and having done little or no retirement planning. This paper examines some of the reasons why older peoples’ financial behaviors depart from… Read More »

Financial Fragility during the COVID-19 Pandemic

Abstract: Early in the COVID-19 pandemic, much of the US economy was closed to limit the virus's spread, and several emergency interventions were implemented. Our analysis of older (45–75) respondents fielded in April–May of 2020 indicates that about 1 in… Read More »

Financial Resilience in America

This fact sheet provides a snapshot of the state of Americans’ financial resilience right before the onset of the COVID-19 pandemic. Many Americans were unprepared to cover a mid-sized emergency expense, and there are considerable variations across groups with different… Read More »

Financial Anxiety and Stress among U.S. Households: New Evidence from the National Financial Capability Study and Focus Groups

Summary: The economic impact of the COVID-19 crisis has brought to light the deeply rooted financial struggles that many Americans face. This paper shows that even before the pandemic, a substantial share of households was already anxious and stressed about… Read More »

Financial Fragility during the COVID-19 Pandemic

Financial Well-Being and Literacy in the Midst of a Pandemic: The 2021 TIAA Insitute-GFLEC Personal Finance Index

Summary: The TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) is an annual barometer of knowledge and understanding which enable sound financial decision making and effective management of personal finances among U.S. adults. It is unique in its capacity to examine financial… Read More »

Fearless Woman: Financial Literacy and Stock Market Participation

Abstract: Women are less financially literate than men. It is unclear whether this gap reflects a lack of knowledge or, rather, a lack of confidence. Our survey experiment shows that women tend to disproportionately respond “do not know” to questions… Read More »

Evaluating Deliberative Competence: A Simple Method with an Application to Financial Choice

We introduce a method for experimentally evaluating interventions designed to improve the quality of choices in settings where people imperfectly comprehend consequences. Among other virtues, our method yields an intuitive sufficient statistic for welfare that admits formal interpretations even when… Read More »

Testing the Use of the Mint App in an Interactive Personal Finance Module (Summary Report)

Summary: If today’s youth are to be full participants in society, they must be financially literate. To advance understanding of effective financial education methods, the Global Financial Literacy Excellence Center (GFLEC) conducted an experiment using Mint, a financial improvement tool… Read More »

Testing the Use of the Mint App in an Interactive Personal Finance Module

Summary: If today’s youth are to be full participants in society, they must be financially literate. To advance understanding of effective financial education methods, the Global Financial Literacy Excellence Center (GFLEC) conducted an experiment using Mint, a financial improvement tool… Read More »

Interest Rates: Prices Hidden in Plain Sight

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Trading Stocks Increases Financial Literacy and Compresses the Confidence Gender Gap

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Avoiding Prejudice: Combat Fatalities, Anti-Muslim Bias, and Work Behavior of Arabs and Muslims

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Debt Close to Retirement and its Implications for Retirement Well-Being

Abstract: We analyze debt and debt management of Americans nearing retirement age, to document that older people have numerous financial obligations that can lead to financial distress. Using data from the 2015 National Financial Capability Study and drawing on an… Read More »

Understanding Debt in the Older Population

Abstract: Poor financial capability can erode well-being in later life. To explore debt and debt management among older Americans, age 51-61, we designed and analyzed a new module in the 2018 Health and Retirement Study along with information from the… Read More »

Stereotypes in Financial Literacy: Evidence from PISA

Abstract: We examine gender differences in financial literacy among high school students in Italy using data from the 2012 Programme for International Student Assessment (PISA). Gender differences in financial literacy are large among the young in Italy. They are present… Read More »

The Stability and Predictive Power of Financial Literacy: Evidence from Longitudinal Data

Abstract: We administered the FINRA Foundation’s National Financial Capability Study questionnaire to members of the RAND American Life Panel (ALP) in 2012 and 2018. Using this unique, longitudinal data set, we investigate the evolution of financial literacy over time and… Read More »

Remaking Retirement: Debt in an Aging Economy

Summary: Around the world, people nearing and entering retirement are holding ever-greater levels of debt than in the past. This is not a benign situation, as many pre-retirees and retirees are stressed about their indebtedness. Moreover, this growth in debt… Read More »

Financial Literacy and Financial Fragility: Evidence to Understand the COVID-19 Crisis

Financial Literacy and Wellness Among U.S. Women: Insights on Underrepresented Minority Women

Summary: The TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) provides an annual measure of overall financial literacy among the U.S. adult population, plus a nuanced analysis of personal finance knowledge across eight functional areas. The 2020 P-Fin Index survey was… Read More »

Stereotypes in Financial Literacy: Evidence from PISA

Abstract: We examine gender differences in financial literacy among high school students in Italy using data from the 2012 Programme for International Student Assessment (PISA). Gender differences in financial literacy are large among the young in Italy. They are present… Read More »

Financial Fragility during the COVID-19 Pandemic

Abstract: Early in the COVID-19 pandemic, much of the US economy was closed to limit the virus’ spread, and several emergency interventions were implemented. Our analysis of older (45-75) respondents fielded in April-May of 2020 indicates that about one in… Read More »

Financial Literacy, Wellness and Resilience Among African Americans

Summary: The financial situation of African Americans lags that of the U.S. population as a whole, and of whites in particular. Simple economic indicators illustrate the gap. While 66% of African Americans report that they are doing at least OK… Read More »

Assessing the impact of financial education programs: A quantitative model

Abstract: Prior studies disagree regarding the effectiveness of financial education programs, especially those offered in the workplace. To explain such measurement differences in evaluation and outcomes, we employ a stochastic life cycle model with endogenous financial knowledge accumulation and investigate… Read More »

Household Financial Fragility during COVID-19: Rising Inequality and Unemployment Insurance Benefit Reductions

Abstract: We draw on new high-frequency survey data collected from repeated cross-sections of Americans between June and November 2020. These data capture rich measures of household financial fragility and employment status. We find evidence of a building “second wave” of… Read More »

Millennials and money: Financial preparedness and money management practices before COVID-19

Abstract: Millennials (individuals age 18–37 in 2018) are the largest, most highly educated, and most diverse generation in U.S. history, and they are already playing a pivotal role in society by making up the largest share of the work force. Consequently,… Read More »

Financial Education Affects Financial Knowledge and Downstream Behaviors

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Attitudes Toward Debt and Debt Behavior

Abstract: We introduce a novel survey measure of attitude toward debt. Matching our survey results with panel data on Swedish household balance sheets from registry data, we show that our debt attitude measure helps explain individual variation in indebtedness as well… Read More »

Best Practices for Teaching in an Online Environment

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Financial Education Affects Financial Knowledge and Downstream Behaviors

Abstract: We study the rapidly growing literature on the causal effects of financial education programs in a meta-analysis of 76 randomized experiments with a total sample size of over 160,000 individuals. The evidence shows that financial education programs have, on… Read More »

The 2020 TIAA Institute-GFLEC Personal Finance Index: Many Do Not Know What They Do and Do Not Know

Summary: The TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) is an annual barometer of knowledge and understanding which enable sound financial decision making and effective management of personal finances among U.S. adults. It is unique in its capacity to examine financial… Read More »

Attitudes Toward Debt and Debt Behavior

Abstract: We introduce a novel survey measure of attitude toward debt. Matching our survey results with panel data on Swedish household balance sheets from registry data, we show that our debt attitude measure helps explain individual variation in indebtedness as… Read More »

Building Financial Resilience

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Financial Education Works

Summary: This podcast talks about the state of financial literacy in the United States, income inequality across communities, and the impact of financial education.

Trust, Financial Literacy and Market Participation

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Household Financial Behavior: What Banking Data Can Tell Us, If We Ask

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Methodological Challenges and Advances in Evaluating Financial Literacy Interventions

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Financial literacy and financial resilience: Evidence from around the world

Abstract: We measure financial literacy using questions assessing basic knowledge of four fundamental concepts in financial decision making: knowledge of interest rates, interest compounding, inflation, and risk diversification. Worldwide, just one in three adults are financially literate—that is, they know… Read More »

Financial Well-Being of the Millennial Generation: An In-Depth Analysis of Its Drivers and Implications

Financial Well-Being of the Millennial Generation: An In-Depth Analysis of its Drivers and Implications

Abstract: This research highlights the importance of designing and offering financial education programs that will optimally meet the needs and address the concerns of this diverse population. To improve financial well-being, programs should be tailored to the financial situation of… Read More »

Retirement Security in a Low-Interest-Rate Environment

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The Impact of School-Based Financial Education on High School Students and their Teachers: Experimental Evidence from Peru

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Fully Closed: Individual Responses to Realized Capital Gains and Losses

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Women in Finance

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New Evidence on the Financial Knowledge and Characteristics of Investors

Abstract: Increased individual responsibility for retirement saving and investing, together with the growing complexity of financial products, require that investors have financial knowledge and awareness. This report provides evidence of substantial differences across investor types. Workplace-only investors, whose exposure to… Read More »

Second Chance: Life without Student Debt

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Income Growth and the Distributional Effects of Urban Spatial Sorting

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Pooling (Data) Assets to Learn about Debts and Debt Collection

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Complexity, Financial Decision Making, and Consequence Messaging

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Attitudes Toward Debt and Debt Behavior

Abstract: We introduce a novel survey measure of attitude toward debt. Matching our survey results with panel data on Swedish household balance sheets from registry data, we show that our debt attitude measure helps explain individual variation in indebtedness as… Read More »

Financial Fragility in America

Debt Close to Retirement and Its Implications for Retirement Well-being

We analyze debt and debt management of Americans nearing retirement age, and we show that older people have numerous financial obligations that can lead to financial distress. Drawing on the 2015 National Financial Capability Study and an extensive literature review,… Read More »

Debt Close to Retirement and Its Implications for Retirement Well-being

Abstract: We analyze debt and debt management of Americans nearing retirement age, and we show that older people have numerous financial obligations that can lead to financial distress. Drawing on the 2015 National Financial Capability Study and an extensive literature… Read More »

Defined Contribution Plans and the Challenge of Financial Illiteracy

Abstract: Retirement investing in the United States has changed dramatically. The classic defined-benefit (DB) plan has largely been replaced by the defined-contribution (DC) plan. With the latter, individual employees’ decisions about how much to save for retirement and how to… Read More »

Defined Contribution Plans and the Challenge of Financial Illiteracy

Abstract: Retirement investing in the United States has changed dramatically. The classic defined-benefit (DB) plan has largely been replaced by the defined-contribution (DC) plan. With the latter, individual employees’ decisions about how much to save for retirement and how to… Read More »

Millennials’ Engagement with Online Financial Education Resources and Tools: New Survey Insights and Recommendations

In today’s economy, individuals—sometimes at an early age—are required to make important and complex financial decisions, many of them with long-lasting consequences. In executing these decisions, people may tap into many resources, including ones online. For those aiming to expand… Read More »

Debt and Financial Vulnerability on the Verge of Retirement

Abstract : We analyze older individuals’ debt and financial vulnerability using data from the Health and Retirement Study (HRS) and the National Financial Capability Study (NFCS). In the HRS, we compare three groups of people age 56-61 in 1992, 2004,… Read More »

Financial Fragility Among Middle-Income Households: Evidence Beyond Asset Building

Abstract: Several years after the financial crisis, financial fragility is not only pervasive in the U.S economy but also prevalent among middle-income households. This highlights the need to consider more than asset levels in order to understand household financial resilience. In… Read More »

Financial Literacy in the United States and Its Link to Financial Wellness: The 2019 TIAA Institute-GFLEC Personal Finance Index

The 2019 TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) represents the third wave of a long-term project to annually assess financial literacy among the U.S. adult population. The P-Fin Index is unique in its capacity to produce a robust measure… Read More »

Financial Fragility in America

Making the World a Better Place: Innovations in Financial Inclusion, Literacy, and Development

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Retirement Savings for All – The Importance of Financial Literacy and FinTech Solutions

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Financial Literacy and the Need for Financial Education: Evidence and Implications

Introduction Throughout their lifetime, individuals today are more responsible for their personal finances than ever before. With life expectancies rising, pension and social welfare systems are being strained. In many countries, employer-sponsored defined benefit (DB) pension plans are swiftly giving… Read More »

Financial Fraud among Older Americans: Evidence and Implications

Abstract: Objectives: The consequences of poor financial capability at older ages are serious and include making mistakes with credit, spending retirement assets too quickly, and being defrauded by financial predators. Because older persons are at or past the peak of… Read More »

Relationship Contracts and Reputation: Evidence from Residential Appraisers

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What Do Hand-Washing and Financial Illiteracy Have in Common?

Summary: This podcast explores the idea that most problems are solved by more education — except when they’re not. Director Lusardi explains that financial education is the path forward to a more financially literate world.

Financial Fraud among Older Americans: Evidence and Implications

Abstract: The consequences of poor financial capability at older ages are serious and include making mistakes with credit, spending retirement assets too quickly, and being defrauded by financial predators. Because older persons are at or past the peak of their… Read More »

The Changing Face of Debt and Financial Fragility at Older Ages

Abstract: U.S. consumer credit and mortgage borrowing expanded rapidly prior to the 2008-9 financial crisis, allowing relatively unsophisticated consumers to decide how much they could afford to borrow. As a consequence, Americans today are more likely to enter retirement in debt… Read More »

Private Paternalism, the Commitment Puzzle, and Model-Free Equilibrium

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Knowledge, Fear and Beliefs: Household Demand for Socially Responsible Investments

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Financial Fragility in the U.S.: Evidence and Implications

Abstract: This project examines financial fragility in the United States, which is measured as individuals’ ability to cope with unexpected expenses. Using data from the 2015 National Financial Capability Study and the 2015 Survey of Household Economics and Decisionmaking, we… Read More »

Consumer-Lending Discrimination in the FinTech Era

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Empowering Youth

A Method for Evaluating the Quality of Financial Decision Making, with an Application to Financial Education

Abstract: We introduce a method for measuring the quality of financial decisions built around a notion of financial competence, which gauges the alignment between consumers choices and those they would make if they properly understood their opportunities. We prove our… Read More »

Financial Literacy Among U.S. Hispanics: New Insights from the Personal Finance (P-Fin) Index

Summary: This report uses the inaugural wave of the TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) to examine financial literacy among Hispanics. A more refined understanding of Hispanic financial literacy could accelerate initiatives to improve their financial well-being.Personal finance knowledge… Read More »

The Gender Gap in Financial Literacy: A Global Perspective

Summary: Financial literacy is a skill that is essential if one is to participate in today’s economy. Wide-ranging developments in the financial marketplace have contributed to growing concerns about the level of financial literacy of citizens of many countries. Through… Read More »

The Gender Gap in Financial Literacy: A Global Perspective

Summary: With data on financial literacy from a survey of more than 150,000 people in 140 economies worldwide, the 2014 Standard & Poor’s Ratings Services Global Financial Literacy Survey (S&P Global FinLit Survey) represents the most comprehensive global measure of… Read More »

Three Central Investment Mistakes (And How to Mitigate their Prevalence)

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The Knowledge Gap in Workplace Retirement Investing and the Role of Professional Advisors

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Debt and Financial Vulnerability on the Verge of Retirement

Abstract: We analyze older individuals’ debt and financial vulnerability using data from the Health and Retirement Study (HRS) and the National Financial Capability Study (NFCS). Specifically, in the HRS we examine three different cohorts (individuals age 56–61) in 1992, 2004,… Read More »

TIAA Institute-GFLEC Personal Finance (P-Fin) Index

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Millennials and Financial Literacy: A Global Perspective

Summary: Worldwide, just one in three adults show an understanding of basic financial concepts, making it clear that billions of people are unprepared to deal with rapid changes in the financial landscape. Credit products, many of which carry high interest… Read More »

Millennials and Financial Literacy: A Global Perspective

Summary: Financial literacy is of utmost importance for Millennials, as they face financial decisions that can have consequences for the rest of their life. However, in a rapidly changing economic landscape, Millennials do not seem to be prepared to deal… Read More »

Ditching the Middle Class with Financial Regulation

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Investors in the United States 2016

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The Social Security Statement: Its History and Impact on Knowledge and Behavior

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The TIAA Institute-GFLEC Personal Finance Index: A New Measure of Financial Literacy

Summary: The TIAA Institute-GFLEC Personal Finance Index (P-Fin Index) measures knowledge and understanding which enable sound financial decision-making and effective management of personal finances. It is unique in its capacity to examine financial literacy across eight areas of personal finance in… Read More »

Remarks of Annamaria Lusardi to the SEC Investor Advisory Committee

Click here to view Director Lusardi's presentation from the SEC IAC meeting. View the agenda of the meeting by clicking here.  Watch the meeting webcast by clicking here (Director Lusardi begins speaking at 48:09).       

Financial Capability and Financial Literacy among Working Women: New Insights

Summary: The following report provides a comprehensive analysis of the personal finances of working women. Using data from the National Financial Capability Study conducted in 2015, we examined the financial capability of working women and how it changed since 2012. The… Read More »

Financial Capability of American Adults: Insights from the American Life Panel

Summary: While providing a wide range of financial capability indicators, the National Financial Capability Study (NFCS) lacks information about important determinants of financial outcomes, such as individuals’ health and cognition, and does not offer a precise, quantitative assessment of critical variables,… Read More »

When will the penny drop? Money, financial literacy and risk in the digital age

Summary: In November 2016, Allianz, in collaboration with Director Annamaria Lusardi, surveyed a total of 10,000 (approximately 1,000 people in each country) in the western European countries of Austria, Belgium, France, Germany, Italy, the Netherlands, Portugal, Spain, Switzerland, and the… Read More »

An Investigation on Health Impact of Self-Employment

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Self-Employment Transitions among Older Americans

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Self-employment for Underserved Older Adults

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Government Supported Entrepreneurship Programs

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Time-Inconsistency and Saving: Experimental Evidence from Low-Income Tax Filers

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Economic Insecurity of American Households

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Wealth Inequality in the US

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Effects of Access to High-Cost Consumer Credit

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Recent Trends of Economic Well-Being

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How Trends in Disability Affect Income Inequality and Financial & Retirement Security

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Time-Inconsistency and Saving: Experimental Evidence from Low-Income Tax Filers

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The National Financial Capability Study: Empirical Findings from the American Life Panel Survey

Summary: The National Financial Capability Study (NFCS) is an ongoing study first conducted in 2009. It is commissioned and supported by the FINRA Investor Education Foundation, in consultation with the U.S. Department of the Treasury and the President's Advisory Council on… Read More »

STUDENT LOAN DEBT IN THE US: AN ANALYSIS OF THE 2015 NFCS DATA

Summary: According to the study, 54 percent of student loan holders did not try to figure out what their monthly payments would be before taking out loans. And 53 percent said that if they could go back and redo the… Read More »

Entrepreneurship Among Baby Boomers: Recent evidence from the Health and Retirement Study

ENTREPRENEURSHIP AMONG BABY BOOMERS: RECENT EVIDENCE FROM THE HEALTH AND RETIREMENT STUDY

Abstract: We study entrepreneurship among Baby Boomers using data from the US Health and Retirement Study (HRS). Using two different definitions of entrepreneurship (being self-employed and being a business owner), we compare entrepreneurs to non-entrepreneurs and entrepreneurs who were age… Read More »

Women and Retirement Security

Summary: Our research investigates whether and how older women’s current and anticipated future labor force patterns has changed over time, to evaluate the factors associated with longer work lives and plans to continue working at older ages. For our empirical… Read More »

HOUSEHOLD FINANCIAL FRAGILITY: EVIDENCE AND IMPLICATIONS

Macrofinancial Symposium: Links between Financial Markets and the American Economy

FINANCIAL LITERACY AROUND THE WORLD: EVIDENCE, THEORY, AND IMPLICATIONS

Older Women’s Labor Market Attachment, Retirement Planning, and Household Debt

Abstract: The goal of this paper is to ascertain whether older women’s current and anticipated future labor force patterns have changed over time, and if so, to evaluate the factors associated with longer work lives and plans to continue work at… Read More »

The Effect of Financial Education on the Quality of Decision Making

Abstract: We introduce a method for measuring the quality of financial decision making built around a notion of financial competence, which gauges the alignment between individuals' choices and those they would make if they properly understood their opportunities. We use it to document the… Read More »

Financial Capability in the United States 2016

Summary: Financial capability is a multi-dimensional concept that encompasses a combination of knowledge, resources, access, and habits. The NFCS is designed to understand and measure a rich, connected set of perceptions, attitudes, experiences, and behaviors across a large, diverse sample in… Read More »

Americans’ Troubling Financial Capabilities: A Profile of Pre-Retirees

Summary: Many people envision a life of work that builds to comfortable and enjoyable retirement years. For previous generations, the financial security that marked that post–labor-force chapter hinged on how generous employers were with pensions or how well employers invested and… Read More »

Employee Financial Literacy and Retirement Plan Behavior: A Case Study

Abstract: This paper uses administrative data on all active employees of the Federal Reserve System to examine participation in and contributions to the Thrift Saving Plan, the System’s defined contribution (DC) plan. We link to administrative records a unique employee survey… Read More »

How financially literate are women? An overview and new insights

Abstract: We document strikingly similar gender differences in financial literacy across countries. When asked to answer questions that measure knowledge of basic financial concepts, women are less likely than men to answer correctly and more likely to indicate that they do… Read More »

The Display of Information and Household Investment Behavior

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Anchors, Target Values, and Credit Card Payments

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Financial Literacy Seminar Series with Abigail Sussman: Anchors, Target Values, and Credit Card Payments

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Behavior Insights for Scalable Solutions in Education

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Financial Literacy Seminar Series with Ben Castleman: Behavioral Insights for Scalable Solutions in Education

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Financial Literacy Seminar with Annamaria Lusardi, Financial Literacy Around the World: Insights from S&P Global FinLit Survey

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Household Financial Fragility: Evidence and Implications

Netherlands - OECD Global Symposium on Financial Resilience throughout Life

HOW FINANCIALLY LITERATE ARE WOMEN? AN OVERVIEW AND NEW INSIGHTS

Abstract: We document strikingly similar gender differences in financial literacy across countries. When asked to answer questions that measure knowledge of basic financial concepts, women are less likely than men to answer correctly and more likely to indicate that they… Read More »

Shifting Paradigms to Improve Retirement Security

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Q&A for Investor Education: Regulators’ Perspectives

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Investor Education: Regulators’ Perspectives

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Investor Education: Regulators’ Perspectives

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Investor Education: Regulators’ Perspectives

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Investor Education: Regulators’ Perspectives

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Q&A Elsa Fornero on Pension Reforms and Financial Literacy

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Pension Reforms and Financial Literacy

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Q&A for Empowering the Youth

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Empowering the Youth

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Empowering the Youth

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Financial Education in Schools: Lessons from Germany

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Q&A Billy Hensley on Stepping up the Effort: Educating Teachers

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Stepping Up the Effort: Educating Teachers

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Financial Education in Schools: Lessons from Australia

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Investor Education: Regulators’ Perspectives

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Financial Education from a Behavioral Perspective

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Investor Education: Regulators’ Perspectives

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Financial Literacy Amongst the Educated

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Stepping Up the Effort: Educating Teachers

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Pensions and the Importance of Financial Literacy Education for Women

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Stepping Up the Effort: Educating Teachers

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Empowering the Youth

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Using a Life Cycle Model to Evaluate Financial Literacy Program Effectiveness

AN OVERVIEW OF THE PISA FINANCIAL LITERACY ASSESSMENT

FINANCIAL KNOWLEDGE AND 401(K) INVESTMENT PERFORMANCE: A CASE STUDY

Abstract: We explore whether investors who are more financially knowledgeable earn more on their retirement plan investments compared to their less sophisticated counterparts, using a unique new dataset linking administrative data on investment performance and financial knowledge. Results show that the… Read More »

Optimal Financial Knowledge and Wealth Inequality

Abstract: We show that financial knowledge is a key determinant of wealth inequality in a stochastic lifecycle model with endogenous financial knowledge accumulation, where financial knowledge enables individuals to better allocate lifetime resources in a world of uncertainty and imperfect… Read More »

The Effect of Financial Education on the Quality of Decision Making

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FINANCIAL LITERACY AROUND THE WORLD: INSIGHTS FROM THE STANDARD & POOR’S RATINGS SERVICES GLOBAL FINANCIAL LITERACY SURVEY

Summary: Given the many ways financial literacy affects financial behavior (Lusardi and Mitchell, 2014), it is important to understand the extent of people’s understanding of basic financial concepts as well as the degree to which financial skills fall short among groups like women and… Read More »

Cognitive Constraints on Valuing Annuities

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Financial Literacy Skills for the 21st Century: Evidence from PISA

Foreward: I am delighted to be asked to give the Colston Warne Lecture at the American Council on Consumer Interests annual conference. What I want to cover in this lecture is what I consider to be one of the most important… Read More »

Visual Tools and Narratives: New Ways to Improve Financial Literacy

Abstract: We developed and experimentally evaluated four novel educational programs delivered online: an informational brochure, a visual interactive tool, a written narrative, and a video narrative. The programs were designed to inform people about risk diversification, an essential concept for financial… Read More »

Credit Scores and Committed Relationships

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INTERNATIONAL DIVERSIFICATION & 296 401(K) PLANS

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International Diversification & 296 401(k) Plans

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Financial Literacy Skills for the 21st Century: Evidence from PISA

Foreward: I am delighted to be asked to give the Colston Warne Lecture at the American Council on Consumer Interests annual conference. What I want to cover in this lecture is what I consider to be one of the most important… Read More »

THE GLOBAL FINDEX DATABASE 2014: MEASURING FINANCIAL INCLUSION AROUND THE WORLD

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The Global Findex Database 2014: Measuring Financial Inclusion Around the World

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Financial Literacy and Retirement Planning in Canada

Abstract: In this paper, we draw on internationally comparable survey evidence on financial literacy and retirement planning in Canada to investigate how financially literate Canadians are and how financial literacy is linked to retirement planning. We find that 42 percent of… Read More »

EMPLOYEE FINANCIAL LITERACY AND RETIREMENT BEHAVIOR: A CASE STUDY

Abstract: This paper uses administrative data on all active employees of the Federal Reserve System to examine participation in and contributions to the Thrift Saving Plan, the system’s defined contribution (DC) plan. We have appended to the administrative records a unique… Read More »

USING A LIFE CYCLE MODEL TO EVALUATE FINANCIAL LITERACY PROGRAM EFFECTIVENESS

Abstract: Prior studies disagree regarding the effectiveness of financial literacy programs, especially those offered in the workplace. To explain such measurement differences in evaluation and outcomes, we employ a stochastic life cycle model with endogenous financial knowledge accumulation to investigate how financial education programs… Read More »

The Effect of Financial Education on the Quality of Decision Making

Abstract: We introduce the concept of financial competence, a measure of how closely individuals’ choices align with those they would make if they properly understood their opportunity sets. The concept is firmly rooted in the principles of choice-based behavioral welfare analysis and… Read More »

Financial Knowledge and 401(k) Investment Performance: A Case Study

Abstract: We explore whether investors who are more financially knowledgeable earn more on their retirement plan investments compared to their less sophisticated counterparts, using a unique new dataset linking administrative data on investment performance and financial knowledge. Results show that the… Read More »

Debt Literacy, Financial Experiences, and Overindebtedness

Abstract: We analyze a national sample of Americans with respect to their debt literacy, financial experiences, and their judgments about the extent of their indebtedness. Debt literacy is a component of broader financial understanding that measures knowledge about debt and… Read More »

Financial Literacy and Economic Outcomes: Evidence and Policy Implications

Abstract: This paper reviews what we have learned over the past decade about financial literacy and its relationship to financial decision-making around the world. Using three questions, we have surveyed people in several countries to determine whether they have the fundamental… Read More »

Minimum Payments and Debt Paydown in Consumer Credit Cards

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Minimum Payments and Debt Paydown in Consumer Credit Cards

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High School Students and Financial Literacy: Evidence from PISA

Click here to read the lecture as published in the Journal of Consumer Affairs.

Hispanic Personal Finances: Financial Literacy and Decisionmaking Among College-Educated Hispanics

Summary: This report examines the personal finances—assets, liabilities, planning behaviors, financial vulnerability and financial literacy—of college-educated Hispanics, i.e., those with high school degrees who report at least “some college” as their highest level of educational attainment. Many college-educated Hispanics are, in… Read More »

State Mandated Financial Education and the Credit Behavior of Young Adults

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BANKRUPTCY RATES AMONG NFL PLAYERS WITH SHORT-LIVED INCOME SPIKES

Abstract: One of the central predictions of the life-cycle hypothesis is that individuals smooth consumption over their economic life cycle; thus, they save when income is high, in order to provide for when income is likely to be low, such as after retirement. We… Read More »

FIVE STEPS TO PLANNING SUCCESS: EXPERIMENTAL EVIDENCE FROM U.S. HOUSEHOLDS

Abstract: While financial knowledge has been linked to improved financial behaviour, there is little consensus on the value of financial education, in part because rigorous evaluation of various programmes has yielded mixed results. However, given the heterogeneity of financial education programmes… Read More »

Financial Illiteracy Meets Conflicted Advice: The Case of Thrift Savings Plan Rollovers

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Financial Illiteracy Meets Conflicted Advice: The Case of Thrift Savings Plan Rollovers

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BANKRUPTCY RATES AMONG NFL PLAYERS WITH SHORT-LIVED INCOME SPIKES

Abstract: One of the central predictions of the life-cycle hypothesis is that individuals smooth consumption over their economic life cycle; thus, they save when income is high, in order to provide for when income is likely to be low, such as after retirement. We… Read More »

The Economic Crisis and Medical Care Use: Comparative Evidence from Five High-Income Countries

Abstract: Objective. We examine how the economic crisis has affected individuals’ use of routine medical care and assess the extent to which the impact varies depending on national context. Methods. Data from a new cross-national survey fielded in the United States,… Read More »

Planning and Saving for Retirement

Financial Literacy and Economic Outcomes: Evidence and Policy Implications

Abstract: This paper reviews what we have learned about financial literacy and its relationship to financial decision-making around the world. Using three simple questions, we have surveyed people in many countries to determine whether they have the fundamental knowledge of… Read More »

HOW FINANCIALLY LITERATE ARE WOMEN? AN OVERVIEW AND NEW INSIGHTS

Abstract: We document strikingly similar gender differences in financial literacy across countries. When asked to answer questions that measure knowledge of basic financial concepts, women are less likely than men to answer correctly and more likely to indicate that they do… Read More »

RISK LITERACY

Abstract: I examine financial literacy—specifically knowledge of risk—using data from surveys in the United States and other countries. I show that risk literacy is very low; the majority of individuals lack knowledge of concepts such as risk diversification and do… Read More »

The Impact of Bank Account Ownership on Adolescents’ Financial Literacy

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The Impact of Bank Account Ownership on Adolescents’ Financial Literacy

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Loan Contracting in the Presence of Usury Limits

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Loan Contracting in the Presence of Usury Limits

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GENDER, CONFIDENCE, AND FINANCIAL LITERACY

THE ECONOMIC IMPORTANCE OF FINANCIAL LITERACY

FINANCIAL LITERACY AND HIGH-COST BORROWING IN THE UNITED STATES

Abstract:  In this paper, we examine high-cost methods of borrowing in the United States, such as payday loans, pawn shops, auto title loans, refund anticipation loans, and rent-to-own shops, and offer a portrait of borrowers who use these methods. Considering… Read More »

FINANCIAL KNOWLEDGE AND 401(K) INVESTMENT PERFORMANCE

Abstract: Using a unique new data set linking administrative data on investment performance and financial knowledge, we examine whether investors who are more financially knowledgeable earn more on their retirement plan investments, compared to their less sophisticated counterparts. We find that… Read More »

FIVE STEPS TO PLANNING SUCCESS: EXPERIMENTAL EVIDENCE FROM U.S. HOUSEHOLDS

Abstract: In this paper, we design and field a low-cost, easily-replicable financial education program called “Five Steps,” covering five basic financial planning concepts that relate to retirement. We conduct a field experiment to evaluate the overall impact of “Five Steps” on a… Read More »

VISUAL TOOLS AND NARRATIVES: NEW WAYS TO IMPROVE FINANCIAL LITERACY

Abstract: In this paper, we developed and experimentally evaluated four novel educational programs delivered online: an informational brochure, a visual interactive tool, a written narrative, and a video narrative. The programs were designed to inform people about risk diversification, an essential… Read More »

FINANCIAL LITERACY AND RETIREMENT PLANNING IN CANADA

Abstract: Financial literacy and Canadians’ capacity to plan for retirement is of primary importance for the policy debate over pension system reform in Canada. In this paper, we draw on internationally comparable survey evidence on financial literacy and retirement planning in… Read More »

OPTIMAL FINANCIAL KNOWLEDGE AND WEALTH INEQUALITY

Abstract: Using a stochastic life cycle model with endogenous financial knowledge accumulation, we show that financial knowledge is a key determinant of wealth inequality. The mechanism we posit is that financial knowledge enables individuals to better allocate resources over their lifetimes… Read More »

FINANCIAL EDUCATION, FINANCIAL COMPETENCE, AND CONSUMER WELFARE

Abstract: We introduce the concept of financial competence, a measure of the extent to which individuals’ financial choices align with those they would make if they properly understood their opportunity sets. Unlike existing measures of the quality of financial decision making,… Read More »

FINANCIAL LITERACY AROUND THE WORLD: AN OVERVIEW

Abstract:  In an increasingly risky and globalized marketplace, people must be able to make well informed financial decisions. New international research demonstrates that financial illiteracy is widespread in both well-developed and rapidly changing markets. Women are less financially literate than men, the… Read More »

FINANCIAL LITERACY AND QUANTITATIVE REASONING IN THE HIGH SCHOOL AND COLLEGE CLASSROOM

Abstract:  This overview frames the eight articles devoted to financial literacy in this issue of Numeracy. The survey questions used to assess financial literacy in the United States, Romania, France, Switzerland, Australia, and elsewhere include mathematics that is routinely covered… Read More »

THE ECONOMIC IMPORTANCE OF FINANCIAL LITERACY: THEORY AND EVIDENCE

This paper undertakes an assessment of a rapidly growing body of economic research on financial literacy. We start with an overview of theoretical research, which casts financial knowledge as a form of investment in human capital. Endogenizing financial knowledge has… Read More »

Household Finance

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It Pays to Set the Menu: Mutual Fund Investment Options in 401(K) Plans

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Gender Differences

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Effects of the Affordable Health Care Act Young Adult Provision

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APEC Guidebook on Financial and Economic Literacy in Basic Education

Summary: This is a joint initiative, that means, it is based on the efforts, knowledge and wisdom of experts from all the APEC economies and at the same time it is hoped to benefit all the economies in the APEC… Read More »

Individual Investors’ Numerical Skills

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Individual Investors’ Numerical Skills

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Inflation Expectations and Behavior: Do Survey Respondents Act on Their Belief?

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Inflation Expectations and Behavior: Do Survey Respondents Act on Their Belief?

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Student Loans

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FINANCIAL SOPHISTICATION IN THE OLDER POPULATION

Abstract:  This paper examines data on financial sophistication among the U.S. older population, using a special-purpose module implemented in the Health and Retirement Study. We show that financial sophistication is deficient for older respondents (aged 55+). Specifically, many in this… Read More »

FINANCIAL CAPABILITY NEAR RETIREMENT: A PROFILE OF PRE-RETIREES

Summary: This report shows how pre-retirees—those between 51 and 61 years of age—face a number of financial challenges. Authors Carlo de Bassa Scheresberg and Annamaria Lusardi use financial capability data from the 2012 National Financial Capability Study to highlight the troubling… Read More »

Trying the Impossible–Financing 30-Year Retirements with 40-Year Careers: A Discussion of Social Security and Retirement Policy

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Trying the Impossible–Financing 30-Year Retirements with 40-Year Careers: A Discussion of Social Security and Retirement Policy

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An Analysis of Default Risk in the Home Equity Conversion Mortgage (HECM) Program

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GEN Y PERSONAL FINANCES: A CRISIS OF CONFIDENCE AND CAPABILITY

Summary:  Generation Y will leave a lasting imprint on American history. The largest, most diverse generation America has seen, Generation Y comprises millions who were born between the late 1970s and the mid-1990s. While this generation is confident, they face… Read More »

Financial Literacy Among Graduate Students: A Case Study from the Indiana University System

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Lapse-Based Insurance

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School Sense Video from within the CFED Presentation

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Financial Education and Account Access among Elementary Students: Findings from the Assessing Financial Capability Outcomes Pilot

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Inattention and Inertia in Household Finance: Evidence from the Danish Mortgage Market

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COLLEGE-EDUCATED MILLENNIALS: AN OVERVIEW OF THEIR PERSONAL FINANCES

Summary:  This study has used new data from the NFCS to analyze salient issues related to college-educated Millennials’ financial capability, practices, and status, and in the process identify key financial challenges they face. The results suggest that the promotion of financial… Read More »

Stepping Up the Effort: Educating Teachers

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Opening at Global Financial Literacy Summit 2013

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Financial Education in Schools: Lessons from Australia

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Empowering the Youth

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PROCEEDINGS OF THE OECD/INFE/GFLEC GLOBAL POLICY RESEARCH SYMPOSIUM TO ADVANCE FINANCIAL LITERACY

Summary: This document collects the contributions of the four main speakers of the OECD/INFE/GFLEC Global Policy Research Symposium to Advance Financial Literacy, held in Paris on 31 October 2013. The conference was co-organised with the Global Financial Literacy Excellence Center… Read More »

DEBT AND DEBT MANAGEMENT AMONG OLDER ADULTS

Abstract:  Many individuals lack the financial know-how to manage the complex new financial products increasingly available in the financial marketplace. How people borrow and manage debt has become of increasing policy maker concern, given recent evidence on Americans’ over-indebtedness. As… Read More »

Financial Literacy and Financial Behavior among Young Adults: Evidence and Implications

Abstract: This paper uses data from the 2009 National Financial Capability Study to examine financial literacy and financial behavior in a sample of approximately 4,500 young adults age 25 to 34. The paper finds that most young adults lack basic financial… Read More »

How Borrowers Choose and Repay Payday Loans

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How Borrowers Choose and Repay Payday Loans

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Active vs Passive Decisions and Crowd-Out in Retirement Savings Accounts

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Predictable Surprise: The Unraveling of the U.S. Retirement System

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FINANCIAL LITERACY AROUND THE WORLD (FLAT WORLD)

Summary:  Across the world, people are being asked to assume more responsibility for their financial well-being. Because of changes in the pension landscape, notably a shift from defined benefit to defined contribution type pensions, individuals must determine not only how much… Read More »

Do Consumers Know How to Value Annuities? Complexity as a Barrier to Annuitization

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Retiree Out-of-Pocket Healthcare Spending: A Study of Consumer Expectations and Policy Implications

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Financial Education for Adults

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Experimental Evidence of the Efficacy of Financial Education for Adults: A Cross Experiment Comparison

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Early Withdrawals from Retirement Accounts

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Early Withdrawals from Retirement Accounts During the Great Recession

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A Complex Portrait: An Examination of Small-Dollar Credit Consumers

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Distinguished Speaker: Elsa Fornero Closing Speech Global Financial Literacy Summit 2012

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Tammo Bijmolt introduces Michael Haliassos at the Global Financial Literacy Summit 2012

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Tammo Bijmolt introduces Keyong Dong at the Global Financial Literacy Summit 2012

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China’s Dynamic Financial Literacy Needs

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State of Financial Literacy in China

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Annamaria Lusardi introduces Elsa Fornero at the Global Financial Literacy Summit 2012

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Marco Trombetta introduces Session 5 and its speakers at the Global Financial Literacy Summit 2012

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Key Challenges & Opportunities: Regional Reports

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Household Financial Literacy, Financial Innovation, and Product Regulation

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From Literacy to Financial Planning: Global Retirement Income Adequacy

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The Role of Banks in Promoting Financial Literacy

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Financial Literacy Around the World: The Big Picture

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Financial Education in Action: New Initiatives

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A Complex Portrait: An Examination of Small-Dollar Credit Consumers

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How America Pays for College 2012

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How America Pays for College 2012

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Study Regarding Financial Literacy Among Investors

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Financial Literacy Among Investors

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Beyond Our Means: Why America Spends While the World Saves

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Beyond Our Means: Why America Spends While the World Saves

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Do Financial “Health” Checkups Prompt Behavioral Changes

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The Storm to Come: A Conversation about Annuities

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Demonstrating the Returns to Work for Children after SSI

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The Persistence of Defaults: When, Why and for Whom?

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Can Commitment Savings Help Americans be Better Prepared for Retirement?

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Panel Discussion: Directions for Further Research on Financial Literacy

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Optimal Knowledge and Wealth Inequality

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Opening Remarks: Overview of the Financial Literacy Conference 2012

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Improving Understanding of Retirement Health Care Expenditures

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Improving Legal Immigrant’s Access to Financial Services

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Five Steps to Financial Planning Success

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Financial Literacy among Young People Discussion

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Financial Literacy among the Middle Aged Discussion

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Financial Capability Discussion

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Evaluating Workforce Financial Education and Encouraging New Hires to Save for Retirement

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Understanding the Geography of Financial Literacy in the U.S.

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Understanding and Measuring Financial Literacy

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Internet Panel Survey Data on Financial Capability and Behavior: RAND American Life Panel

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Social Networks and The Decision To Insure

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Social Networks and The Decision To Insure

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Financial Literacy and Retirement Planning in the United States

Abstract: We examine financial literacy in the US using the new National Financial Capability Study, wherein we demonstrate that financial literacy is particularly low among the young, women, and the less-educated. Moreover, Hispanics and African-Americans score the least well on… Read More »

Financial literacy and retirement planning in the United States

Abstract: We examine financial literacy in the US using the new National Financial Capability Study, wherein we demonstrate that financial literacy is particularly low among the young, women, and the less-educated. Moreover, Hispanics and African-Americans score the least well on… Read More »

Financial literacy and stock market participation

Abstract: We have devised two special modules for De Nederlandsche Bank (DNB) Household Survey to measure financial literacy and study its relationship to stock market participation. We find that the majority of respondents display basic financial knowledge and have some… Read More »

Financially Fragile Households: Evidence and Implications

Abstract: We examine households’ financial fragility by looking at their capacity to come up with $2,000 in 30 days. Using data from the 2009 TNS Global Economic Crisis Study, we document that approximately one-quarter of U.S. respondents are certain they… Read More »