Monday, November 15, 2004

Financial illiteracy 

The Jump$tart coalition reports a depressing trend in the ability of high school seniors to understand the basics of finance:
APersonal Financial Literacy Survey undertaken by Jump$tart in 2003-2004 tested the level of knowledge within the four core areas of income, money management, spending and credit and saving and investing. The biennial survey was administered to a national sample of 4,074 high school seniors representing 215 schools in 33 states. ... survey participants answered only 52.3 percent of the questions correctly�failing on a grade scale used by most schools.
A sample question is this:
Retirement income paid by a company is called:
a) 401k
b) pension
c) Social Security
d) rents & profits
More students are learning about finance in school these days, but the courses are often in personal finance or "consumer science" classes, rather than integrated into math or economics. The coalition would prefer to see the courses in the latter place, which are more mainstream courses.