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December 03, 2015 at 07:15 AM
The United States may consider itself best in a lot of areas, but when it comes to financial literacy it falls short.
Of more than 140 countries surveyed in a global financial literacy survey by Standard & Poor’s Ratings Services, the United States ranks 14th.
S&P gave a five-question quiz to to more than 150,000 adults in 148 countries, looking at four basic financial concepts: numeracy, interest compounding, inflation, and risk diversification. Those who correctly answered questions on at least three of those concepts were deemed financially literate.
According to the study, the U.S. – with a financial literacy rate of 57 percent – trails behind countries such as Germany (66 percent), Israel (68 percent), the United Kingdom (67 percent) and Norway (71 percent).
Within the G7 group of countries (Canada, France, Germany, United Kingdom, Italy, Japan, and the United States), financial literacy varies enormously – from a low of 37 percent in Italy to a high of 68 percent in Canada.
The survey finds that the United States shows different levels of financial literacy according to gender, income and education.
Americans with less education and lower incomes have lower financial literacy levels than their counterparts in other wealthy countries.
According to the survey, 47 percent of U.S. adults living in poorer households are financially literate. Countries that are doing much better include Denmark (65 percent), Sweden (64 percent), the U.K. (63 percent) and Canada (61 percent).
While half of U.S. adults with a secondary education are financially literate, about two-thirds of adults in Germany, Canada and the U.K. are financially literate.
Regarding gender, the survey shows that in almost every country there is a gap between men and women, but it’s a little bit worse in the U.S.
