Financial Literacy and the Cost of Ignorance
Over the last 40 years, Americans have taken on increasing responsibility for their financial well-being, from planning for retirement, to choosing a health insurance plan, to saving for education. Financial literacy, or the ability to use knowledge and skills to manage financial resources effectively, plays a key role. Financial "ignorance" can lead to credit card debt, overwhelming college loans, and even bankruptcy. In this podcast, Annamaria Lusardi explains why it is important to teach students at a young age how to make complex financial decisions. She also describes workplace programs and policy changes that could help individuals learn about managing their personal finances.
Denit Trust Chair of Economics and Accountancy, George Washington University School of Business; Adjunct Economist, RAND Corporation