Back to School: Students “Ace” Financial Basics, but Continue to Give Themselves a “C” in Money Management
September 14 2016 - 10:43AM
Business Wire
U.S. Bank’s Second Annual Student and Personal Finance Study
Examines the Attitudes and Philosophies of Financial Literacy of
High School and Undergraduate Students
School is back and in session and when it comes to financial
literacy, students have confidence in the basics, but continue to
give themselves a “C” when it comes to money management. These are
the overall findings of the 2016 U.S. Bank Student and Personal
Finance Study which examines the attitudes and philosophies on
financial education among high school and undergraduate college
students ages 18 to 30 years old.
“This is the second year we have checked in with students to see
how financially literate they are,” said Robyn Gilson, U.S. Bank
Coach for Student Financial Education. “What we found is that
students continue to know the basics like budgeting and savings –
but when the conversation shifts to credit and investing, the
grades drop. We want students to know it’s not too early to
understand credit or how to make solid financial investments for
their futures. It’s so important to start young.”
In the 2016 study, students report they feel knowledgeable about
the basics of saving and checking accounts (42%) and about saving
money in general (39%). But when it comes to their knowledge of
understanding credit, there are a lot of misunderstandings. Most
students (54%) incorrectly believe having too many credit cards can
negatively impact their credit score and 44% incorrectly believe
using checks and debit cards helps to build credit. And, less than
half (46%) of students have checked their credit score.
“College is a good time to get your first credit card because
establishing a strong credit history can set you up to get
a loan for a major purchase – like a car – on your own once
you start working, instead of relying on a parent to co-sign,” said
Gilson. “We recommend using your credit card responsibly by paying
for bills and everyday expenses – without overspending – and then
paying off the balance in full on time each month.”
Beyond understanding credit, students also lack knowledge of
investing money (15%) and how to save for retirement (11%). They
also report a struggle to keep up with their day-to-date expenses,
but they are getting a little bit better. Last year, 67% of
students reported that they are barely keeping up in managing their
daily finances, while this year that number improved slightly to
60%. And there are slight differences when it comes to gender. Male
students report they are more comfortable and feel extremely
prepared to meet their financial goals, describing themselves as
‘savers.’ Female students more often describe themselves as
‘spenders,’ feeling ‘not at all prepared’ to meet their financial
goals.
The study also measured students’ views on what success looks
like. Success to students doesn’t necessarily mean owning a home or
having a high income. Most students cite personal happiness (72%)
and health (66%) as very important measures of success in life,
while home ownership (35%) and high income (23%) are considered
less important.
Finally, students are not great at protecting their identity,
despite being hyper-connected and tech-savvy. Though 57% keep their
passwords a secret, 22% use passwords that are easy to remember and
only 27% change them regularly. About 45% of students monitor their
credit card account activity regularly and only 41% verify a
business’ legitimacy before sharing financial or personal
information with them.
As part of U.S. Bank’s dedication to financial education,
students and parents can access advice, tools and resources on
Student Union. Students can also apply to win an up-to-$20,000
scholarship for completing a series of short online personal
finance courses covering credit, budgeting and more.
About the Student and Personal Finance StudyThe 2016 U.S.
Bank Student and Personal Finance Study was an online, quantitative
survey of 1,615 high school seniors and undergraduates (ages 18 to
30 years old) to assess their financial literacy, concerns and
goals in comparison to their parents. The survey was conducted in
May.
About U.S. BankMinneapolis-based U.S. Bancorp (NYSE:
USB), with $438 billion in assets as of June 30, 2016, is the
parent company of U.S. Bank National Association, the fifth largest
commercial bank in the United States. The Company operates 3,122
banking offices in 25 states and 4,923 ATMs and provides a
comprehensive line of banking, investment, mortgage, trust and
payment services products to consumers, businesses and
institutions. Visit U.S. Bancorp on the web at www.usbank.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20160914005863/en/
U.S. Bank Corporate CommunicationsSusan Beatty,
612-303-9229susan.beatty@usbank.com
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