April 2023 – Financial Literacy Month

April is Financial Literacy Month. It’s a month to raise awareness around financial literacy and wellness, and highlighting the importance of financial planning and of developing  healthy financial habits.

A new National Financial Educators Council (NFEC) survey found that lacking financial literacy — and not knowing how to manage personal finances — carried a high cost in 2022.

The NFEC survey showed that 38% of Americans said their lack of financial literacy cost them $500 or more, and a whopping 23% said it cost them more than $10,000 — a steep increase from the 10.7% who said the same in 2021.

As a result, the estimated average amount of money that financial illiteracy cost Americans was $1,819 in 2022 — the highest average since the first annual survey took place six years ago. This figure correlates with record-high inflation rates and other economic challenges, the NFEC noted.

In terms of common costly mistakes, overdraft fees were prominent: the median overdraft fee on a debit card is $34, according to the Consumer Financial Protection Bureau (CFPB).

According to the survey, which cites CFPB data, most debit card overdraft fees happen on transactions of $24 or less — and American consumers end up spending $17 billion a year on overdraft and non-sufficient funds fees.


References:

  1. https://www.nasdaq.com/articles/financial-literacy-or-lack-thereof-can-make-the-difference-of-%2410000-or-more-a-year-on
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