How “money smart” are you? A new survey from the American College of Financial Services says you’re probably not as knowledgeable as you think.
The survey conducted by the nonprofit accredited college found 74% of participating Americans failed a 38-question quiz about financing retirement. Think about that. And only 5% got 81% or more of the questions correct.
More than 1,200 Americans between 60 and 75 years old with at least $100,000 in assets participated in the Retirement Income Literacy Survey, which claims to be the most comprehensive survey exploring the drawdown phase of American retirement.
“Over the next 12 years, an estimated 10,000 Baby Boomers will reach the age 65 every day,” said David Littell, Retirement Income Program co-director at the college. “More and more Americans are retiring, but so few understand basic facts and strategies when it comes to ensuring that their retirement is a comfortable one. The results of this survey are alarming.”
Americans think they know more than they do. Of the 61% who claimed to have a high level of financial literacy, only a third passed.
Only 17% of women passed the quiz. But men can’t claim much better; only 35% of them passed.
Of the participants with a graduate degree, 60% failed.
Only 20% of people with less than $1 million in savings passed, but among those with more than a million bucks, only half passed.
The survey asks about investments, Social Security, inflation, long term care, and more.
The American College of Financial Services was founded in 1927 and is the nation's largest nonprofit educational institution devoted to financial services, offering financial planning designations including the Retirement Income Certified Professional (RICP®), Chartered Life Underwriter (CLU®), Chartered Financial Consultant (ChFC®), and the Certified Financial Planner (CFP®).
Transamerica is not affiliated with the American College of Financial Services.