As a result of the recession, some Americans have made behavioral changes in their financial lives.
In spite of a positive trend, there’s a mixed message in the latest consumer financial literacy survey by the National Foundation for Credit Counseling.
More than two in five adults, or 43 percent, now closely track their spending – an improvement over 39 percent in 2007.
However, more than half, 56 percent, still do not have a budget, and more than 11 million adults do not monitor their overall spending and don’t know how much they spend on food, housing and entertainment.
On a brighter note, the proportion of adults who have non-retirement savings increased from 63 percent in 2007 to 67 percent in 2010.
Nonetheless, more than 68 million people have no savings, while only 24 percent are now saving more than they did a year ago.
Thirty-nine percent of Generation Y adults report having no savings. One in four of those with no savings say that if faced with an emergency, they would charge take out a loan, 29 percent, or charge it to a credit card, 25 percent, – which only adds to any existing debt.
Adults perceive themselves as having increased in their knowledge of personal financial literacy. In 2009, 41 percent graded themselves as C, D or F.
By this year, that number dropped to 34 percent. Nevertheless, nearly four in five adults say they would benefit from advice and answers to everyday financial questions from a professional.
“Sometimes it takes hitting bottom to facilitate change,” said Susan C. Keating, CEO of the NFCC. “Tracking spending and creating non-retirement savings are two of the building blocks to financial stability, and the recession has served as a harsh reminder of this to millions who have been affected by the economic downturn. We are encouraged by the positive developments, but nonetheless remain concerned about the many areas where the survey exposed continued financial deficiencies.”
The 2010 Financial Literacy survey was conducted by telephone within the United States by Harris Interactive on behalf of the NFCC during March. The full survey is available at www.NFCC.org.