States with the highest financial literacy: Rankings
May 4, 2016 by IFAwebnews Staff
According to WalletHub.com’s latest state rankings of financial literacy, many Americans have not learned lessons of the past, from the Great Recession to the comparatively recent housing bubble burst.
The rankings, which included the District of Columbia, show a woeful lack of knowledge about managing finances, despite a continuing, if slow, economic recovery.
Since 2012, credit card debt has risen by $153 billion, a sign that the bitter taste of 2008 might have been forgotten. As for making a family budget, half of those in the U.S. don’t bother. In addition, 54 percent don’t have any money saved for emergencies and, as was the case last year, 20 percent outspend their incomes.
WalletHub.com used three criteria to rate states: its own literacy survey; planning & daily habits; and knowledge & education. Components of the second category included the high school dropout rate, results of a Financial Industry Regulatory Authority literacy survey and the percentage of adults with a bachelor’s degree, among other things. The third category included looking at the percentage of people who spend more than they earn, how many have a rainy-day fund and those paying just the minimum due on credit cards.
Taking everything into account led to WalletHub.com’s U.S. rankings with the literacy test counting for half a state’s score.
It’s notable that even the smartest states fall well short of a perfect 100 in the scoring.
The Top 10 rankings were:
10. Virginia
Overall Score: 65.86
Literacy: 44 out of 51
Planning & Daily Habits: 25 out of 51
Knowledge & Education: 2 out of 51
9. New York
Overall Score: 66.11
Literacy: 44
Planning & Daily Habits: 25
Knowledge & Education: 2
8. Utah
Overall Score: 66.46
Literacy: 46
Planning & Daily Habits: 6
Knowledge & Education: 1
7. Florida
Overall Score: 66.69
Literacy: 2
Planning & Daily Habits: 14
Knowledge & Education: 27
6. Maine
Overall Score: 66.79
Literacy: 17
Planning & Daily Habits: 7
Knowledge & Education: 11
5. Maryland
Overall Score: 66.95
Literacy: 35
Planning & Daily Habits: 4
Knowledge & Education: 4
4. New Jersey
Overall Score: 67.11
Literacy: 22
Planning & Daily Habits: 5
Knowledge & Education: 8
3. Illinois
Overall Score: 67.24
Literacy: 6
Planning & Daily Habits: 12
Knowledge & Education: 13
2. Minnesota
Overall Score: 68.12
Literacy: 12
Planning & Daily Habits: 16
Knowledge & Education: 5
1. New Hampshire
Overall Score: 69.93
Literacy: 16
Planning & Daily Habits: 1
Knowledge & Education: 6
