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Financial Planning > Behavioral Finance

Financial Literacy Starts at Home, Survey Shows

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Nearly half of Americans surveyed by the National Foundation for Credit Counseling say they learned more about personal finance at home from their parents than they did anywhere else.

The 2012 Financial Literacy Survey, conducted online in May and taken by 785 respondents, found 44% of Americans picked up their money management skills from their parents (although the same percentage acknowledge that they’ve never compared their parents’ habits with their own). Just 10% said they learned their financial skills at school.

Of the respondents who have compared their financial skills with their parents’, 12% were driven to adopt habits that are the exact opposite. Thirty-five percent said they adopted some of their parents’ habits, while picking up some new ones of their own.

“Whether parents are astute money managers or woefully lacking in financial skills, their behavior influences what the children are learning, and likely impacting how they will handle their own finances as adults,” said Gail Cunningham, spokesperson for the NFCC, in a press release. “Understanding this dynamic should serve as an incentive for adults to improve their own grasp of personal finance, because like it or not, their actions in this area will speak loudly.”

The NFCC developed 10 questions that could help parents start a discussion with their teenage children about money—a discussion that is probably less than thrilling to said teenagers if it doesn’t involve actual money:

  1. Do you think children should be paid to do household chores?
  2. Could you live on the current federal minimum wage in America of $7.25 per hour?
  3. If not, how could you convince your boss that your skill set is worth more than the minimum?
  4. How many hours are you willing to work to pay for that new pair of tennis shoes you want?
  5. How is a checking account different from a debit card?
  6. Why do credit card issuers charge customers different interest rates?
  7. If not compact disc, what do the initials CD stand for?
  8. Could you save a dollar each day from now until Christmas?
  9. If you received $100 for your birthday, what would you do with the money?
  10. What’s the difference between collision and liability car insurance?