Champlain College Report Card: Americans Lack Knowledge and Skills, Make Poor Financial Decisions

December 12, 2016 | By Champlain News

BURLINGTON, VT. -- Are we financially illiterate? Was our lack of financial acumen a cause of the Great Recession of 2008 and does it continue to undermine our nation's economic health? Unfortunately, the answer is yes to all of these questions, but until now, the extent of our financial ignorance had not been quantified.

The 2016 National Report Card on Adult Financial Literacy, released Monday by Champlain College's Center for Financial Literacy, shows that adults in America earned just a C grade. More than three-quarters of adults live in states with poor grades. This means that too many adults are deficient in financial knowledge and skills, which leads them to make uninformed and often poor decisions about their money.

John Pelletier, executive director of Champlain College's Center for Financial Literacy, says the report card assesses the problem nationally, and gives grades to each state based on data gleaned from national organizations that track Americans' financial knowledge, credit, saving and spending, retirement readiness, investing, and levels of insurance.

"The goal of this report is to inform," says Pelletier. "We need to make adult personal finance education a priority among policymakers, financial institutions, the educational establishment, and others so that we can begin to build a financially savvy citizenry."

Pelletier says the challenge is educating the millions of Americans who misuse credit, don't save for a rainy day or for retirement, don't pay their bills on time or have a budget, or know how to invest or plan for the future.

"The first step in addressing this challenge is to gauge our financial illiteracy, and that it what this report does," he says. "Our hope is that the facts will motivate efforts to improve personal finance education for adults in this nation. It's important to individuals, families and our nation."

No state earned an A grade. The Center's research team used a relative grading system, so even those states with A- or other high grades are merely the best among a group of low-performing states. "In other words," Pelletier notes, "our report shows that our nation has dramatic room for improvement, so one should not be misled by grades."

To arrive at the relative grades, 59 data points were drawn from 18 national organizations. Learn more about the methodology

To view the full report, click here. To view any state fact sheet, click here.

The Report website: http://www.champlain.edu/centers-of-excellence/center-for-financial-literacy/national-report-card-on-adult-financial-literacy

Champlain College Center for Financial Literacy: Established in 2010, Champlain College's Center for Financial Literacy is a nationally acclaimed, one-of-a-kind financial literacy program aimed at increasing knowledge of money matters in classrooms across Vermont, ensuring that college students graduate with the skills to make sound decisions about spending, credit and investments, and helping adults navigate difficult financial situations like buying a home and saving for retirement. The Center is a partnership among several financial institutions, non-profit entities and governmental agencies. The Center advocates for more financial education opportunities at the local, state and national level and has launched a variety of programs aimed at increasing the personal finance sophistication of our citizens.

Founded in 1878, Champlain College is a small, not-for-profit, private college in Burlington, Vermont, with additional campuses in Montreal, Quebec and Dublin, Ireland. Champlain offers a traditional undergraduate experience from its beautiful campus overlooking Lake Champlain and more than 60 online undergraduate and graduate degree programs and certificates. Champlain's distinctive career-driven approach to higher education embodies the notion that true learning occurs when information and experience come together to create knowledge. Champlain College is included in the Princeton Review's The Best 381 Colleges: 2017 Edition. Champlain College is featured in the "Fiske Guide to Colleges" for 2017 as one of the "best and most interesting schools" in the United States, Canada, and Great Britain. Champlain was named one of the “Most Innovative Schools” in the North by the U.S. News and World Report’s 2017 “America’s Best Colleges and #91 in the overall list of “Best Regional Universities in the North. For more information, visit www.champlain.edu.