FINRA study: Americans’ Financial Capability Growing Stronger, but Not for All Groups

Study results released yesterday by the FINRA Investor Education Foundation found that, although Americans as a whole are feeling less financial stress, making ends meet remains a daily struggle for millions — particularly women, millennials, African-Americans, Hispanics, and those lacking a high school education.

Among the study’s most significant findings:

  • More than one in five Americans (21 percent) have unpaid medical debt, and women are more likely than men to put off medical services due to cost, such as seeing a doctor, buying needed prescriptions or undergoing a medical procedure;
  • Nearly half of respondents with a high school education or less could not come up with $2,000 in 30 days in the event of an emergency (45 percent) compared to only 18 percent for respondents with a college degree;
  • Twenty-nine percent of 18 to 34-year olds with a mortgage have been late with a mortgage payment, compared with 7 percent for the 55+ age group;
  • Hispanics and African-Americans are much more likely to use high-cost forms of borrowing like pawn shops and payday loans compared to whites—39 percent for African-Americans, 34 percent for Hispanics and 21 percent for whites; and
  • Only 37 percent of respondents are considered to have high financial literacy, meaning they could answer four or more questions on a five-question financial literacy quiz—down from 39 percent in 2012 and 42 percent in 2009.

However, the percentage of respondents reporting no difficulty in covering monthly expenses and bills increased from just over a third in 2009 (36 percent) to nearly half in 2015 (48 percent), and the percentage of respondents with emergency funds increased from 35 percent in 2009 to 46 percent in 2015.

The report, entitled "Financial Capability in the United States 2016," is available here. The webpage allows readers to see either national or individual state findings.