This Report Graded States on Financial Literacy — and It Doesn’t Look Good

Financial literacy
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How does your state stack up when it comes to financial literacy?

We know which states are the poorest or the richest, where the best jobs are, where to find the most affordable housing and which states have the highest student loan debt.

But do you know how much your state actually knows about personal finance?

A new report from Champlain College’s Center for Financial Literacy ranks states on their financial knowledge and behavior — and shows where we’re falling behind.

As you might expect, we’re not doing so hot as a country.

The report measured each state’s overall level of adult financial literacy using 59 data points from 18 organizations. It graded states for overall literacy and in each of these categories:

  1. Financial Knowledge

  2. Credit

  3. Student Loan Debt

  4. Savings and Spending

  5. Retirement Readiness

  6. Investing

  7. Insurance

“As you will see, many adults lack financial literacy knowledge and/or exhibit behaviors that suggest poor or, perhaps, uninformed choices,” the report says.

Mississippi was the only state to get an overall F grade. Most of the South fell in the D or C range. Virginia topped the region with a B-.

The Midwest, Northwest and Northeast got A’s and B’s, with Minnesota at the top of the list with an A-.

But before you celebrate, let’s break that down.

Is Our Nation Financially Illiterate?

States were graded on a curve.

If a state receives a good grade, it may not mean great financial literacy, just that it’s more literate than other states.

When you break down how well each state actually does in financial literacy, it looks pretty bleak.

For example, Utah received the best grade (100%) in “Financial Knowledge.” The category measured answers to a financial knowledge test, whether participants received financial education and whether the state offers financial education in high school.

In Utah, the average number of correct answers on the six-question financial knowledge test was 3.4. Just 29% of respondents had participated in a financial education course.

That was the best in our country.

On credit, Minnesota topped the nation. The average credit score in that state is 707, which is hopeful.

Still, only 59% of Minnesotans always pay their credit card balance in full. A quarter make only minimum payments monthly, and 40% carry a balance that’s accruing interest.

Compare that with Mississippi, in last place for credit, whose average credit score is 644. There, 32% of residents make only monthly minimum credit card payments, and 48% always pay their balance in full.

No matter where you look, the country has room for improvement.

Ways to Improve Financial Literacy

The report points out “financial literacy” happens in two parts: what you know and what you do with your knowledge.

You have to first understand the basics of personal finance: e.g. what affects your credit score, how to save for retirement, the best ways to pay back student loans and how to start investing.

To get you started (whether you’re in the top state or the bottom!), check out some of our Smart Money posts that demystify these topics:

Then you actually have to put that knowledge into practice.

That can be harder. I write about personal finance every day, and still haven’t taken the proper steps to improve my abysmal credit score or done any more to save for retirement than contribute to my workplace 401(k).

But I’m inspired by other Penny Hoarders. If you think hope is lost, read these stories of exactly how these people navigated some tricky financial spots:

Your Turn: How does your state stack up in financial literacy?

Dana Sitar (@danasitar) is a staff writer at The Penny Hoarder. She’s written for Huffington Post,, Writer’s Digest and more, attempting humor wherever it’s allowed (and sometimes where it’s not).

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