Financial Literacy in Millennials

Abstract

The main goals for this project include are to find out the current knowledge of teens (14-20) with regard to financial literacy, to create a survey from which external information can be gathered and to analyze the results and observations of this survey, and thus make recommendations to financial and educational institutions. The goal of teaching financial literacy to teens is to reach them with relevant information they can really use in life now and in the future. This can be extended to financial decision making later as they enter adulthood. It’s useful to center instruction around important upcoming life events such as college decisions, budgeting on a tight budget, use of credit and debit cards and learning how to save and invest in the future. This also includes managing personal finance in college, especially if they decide to go to a foreign country. In this research project we will investigate the knowledge base teenagers have regarding money management and decision making. As a base we will use one of the largest financial services surveys for financial literacy created by the National Financial Educators Council. The goal of this project is to create a list of 30 questions derived from the most appropriate national surveys and administer it to more than 50 individuals, ages 14-20. The key insights included that 71.2% respondents did not consider themselves financially literate. It was clearly visible that respondents lacked knowledge on topics such as inflation, credit score and insurance. Moreover, 78.8% of respondents have not taken any class/course in financial literacy. The report concludes with recommendations to both financial institutions and educational institutions to increase specific areas of financial literacy.