Survey Shows They Are More Concerned About Fiscal versus Physical Health
August 18, 2020
Banks and credit unions should step up their financial literacy classes for their customers. There’s a strong demand in this country as consumers worry about their fiscal health more than their physical health.
As COVID-19 has extended beyond a health crisis into an economic crisis as well, it has exposed how financially vulnerable many Americans are. Half of all Americans (50%) would experience financial hardship if they had to cover an emergency expense of $1,000 or less in the next 30 days, according to a new Charles Schwab Financial Literacy Survey conducted by The Harris Poll.
Americans indicated they wish they had better money management skills, according to the survey. When asked what they would teach their younger selves about personal finance based on what they know today, Americans said the value of saving money (59%), basic money management (52%), and how to set financial goals and work toward them (51%).
Nearly two-thirds (63%) of U.S. adults chose financial education as the most important supplementary graduation requirement to math, English and science, compared to 43% who chose health and wellness education.
“Financial illiteracy is insidious. The antidote is financial education, which gives people the skills they need to make smart money decision and can help improve their lives,” said Carrie Schwab-Pomerantz, president of Charles Schwab Foundation. “The pandemic has underscored just how critical basic personal finance skills are in preparing for the unexpected. Financial literacy is a survival skill that everyone needs.”
On a scale of 1-100, Americans rated money management (62.9) as the most important skill for kids to learn, edging out the dangers of drugs and alcohol (60.5), healthy eating and exercise habits (58.3), and safe driving practices (57).
The impact of financial illiteracy is not lost on the American public. 89% of Americans agree that lack of financial education contributes to some of the biggest social issues our country faces, including poverty (58%), lack of job opportunities (53%), unemployment (53%), and wealth inequality (52%).
Despite the ongoing debate about virtual learning and how to reopen schools, most Americans (65%) still look primarily to schools to provide financial education, followed by government (12%) and employers (10%). Only 21 states currently require high school students to take a personal finance course.
“History shows that every time our country faces a crisis – whether it’s COVID-19, Hurricane Katrina, or 9/11 – the need for greater financial literacy becomes more apparent,” said Schwab-Pomerantz. “We are in a really uncertain time period when a lot of Americans are faced with difficult financial decisions that will have immediate and long-term effects on their lives.”
With millions of Americans out of work and the future of unemployment benefits uncertain, many people are questioning how best to manage their money right now. Schwab-Pomerantz recommends five key steps every American can take to help shore up their finances during this period of uncertainty.
The Bottom Line
Most financial institutions have tremendous excess capacity in their existing branches today.
Digital technology drives three major banking industry trends: digital transformation, brand specialization and partnerships.