Capital One Survey of High School Seniors Reveals Gender Gaps in Financial Literacy
Although the survey data shows the majority of soon-to-be male graduates believe they are ready to take on these new challenges, the female students are less certain of their ability to manage their finances on their own.
According to the survey, two-thirds (65.4 percent) of the male students rated themselves as “highly knowledgeable” about personal finance compared to less than half (49.2 percent) of the young women who participated in the survey. While the gender differences are surprising, these numbers also show a striking correlation between the students’ confidence about their financial knowledge and whether or not they had participated in a financial education class, with 45 percent of the male students surveyed and 61 percent of the female students reporting that they have never taken a personal finance class.
Overall, one-third of the students (33.8 percent) said that they were either unsure or unprepared to manage their own banking and personal finances.
“It’s clear that financial education, or the lack of it, has an impact
on students and the level of confidence they have in their ability to
manage money on their own,” said
Early practical experience with money and banking helps establish good habits
Real world experience also prepares seniors for the financial challenges and independence they will face upon graduation. Eighty percent of the high school seniors surveyed report that they have had a bank account for one to two years and that they are regularly checking their account balances. Most of those with checking accounts (73 percent) balance their checkbooks at least once each month and one quarter report that they check their bank account balances weekly for activity and errors. The vast majority (85 percent) of the students also said they at least periodically set money aside in savings. However, only half of the students surveyed (50.6 percent) use a budget to manage expenses and savings.
Parents are a primary resource
The majority of the student’s participating in the Capital One survey (70 percent) reported that they, at least occasionally, look to their parents for advice about money management and personal finance. However, only 27 percent said that their parents are their primary resource for financial information.
For seniors who will soon be graduating and experiencing more financial freedom, Capital One offers the following tips for a healthy financial future:
- Establish financial goals – As a first step to financial freedom, consider and establish your own financial goals. Short-term goals could include setting aside money to cover everyday expenses or saving toward a vacation with friends. Long-term financial goals might include planning to repay student loans or saving to buy a new car.
- Develop a realistic budget that you can stick to – After graduation, many seniors may be responsible for a number of bills and personal expenses for the first time. Once you’ve established financial goals, create a budget of expenses you expect to incur. Gather recent receipts and be sure not to forget bills or things that may be automatically deducted from your bank account. Then determine your expected income. Determining your expenses and your income will show any gaps and will allow you to allocate your money properly, ensuring you are in control of your income and on track to meet your financial goals.
- Prepare for the unexpected – When creating a budget be sure to set aside money for emergency situations or unexpected fees.
- Balance your checkbook – It is one of the easiest ways to keep track of your finances and avoid unnecessary fees that will eat away at your budget.
- Simply pay attention – Thoroughly read all bills, contracts and fine print. This is one of the most important keys to financial responsibility. It’s important to know your interest rates on all credit cards and loans. You should also check your bills closely for mistakes each month and report any erroneous charges immediately.
- Pay on time – Paying your bills on time is the most important step toward establishing a good credit history. If you anticipate that you will be late on a payment, contact your lender in advance to make them aware of your situation and see if there is any room for negotiation.
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Be smart about credit – Look for ways to establish a good
credit history early on as your credit rating will play an important
role down the road. If you choose to apply for a credit card or loan,
be sure to read the fine print and understand any fees associated with
the card. Also be sure to check your credit report at least once a
year; regularly checking is one of the best ways to protect against
identity theft and credit fraud. Consumers are eligible for one free
credit report every year from each of the three major credit reporting
agencies. Individuals can request their free credit report online at www.annualcreditreport.com
or by calling 1-877-322-8228. Consumers should also be sure to correct
any mistakes on their credit report right away. You can do so by
contacting each of the three major credit reporting bureaus –
Equifax ,TransUnion andExperian . - Save, save, save – While it might be challenging to put aside money in savings, this is an important habit to establish. No matter how little you put away, every little bit helps so don’t wait to start saving. Put aside anything you can today. One way to do this is to have money automatically transferred to savings. This is one of the easiest ways to begin saving. Set up automatic transfers in regular increments to ensure that money goes directly to savings.
More information about personal finance and money management is available on the Capital One website, including a free interactive online tool developed in partnership with the non-profit consumer advocacy group Consumer Action, which is available at http://www.capitalone.com/financialeducation/cbt/launcher.htm.
MoneyWi$e program arms consumers with financial tools and information
Education is the key to a healthy financial future. To help consumers, Capital One and Consumer Action created the MoneyWi$e financial education program. The MoneyWi$e eLearning tool provides interactive modules, worksheets and calculators to help consumers with various personal finance topics, including saving, budgeting, and rebuilding credit. The program includes a special section dedicated to “Talking to Teens About Money.” Through interactive modules, parents can learn how to teach teens about saving, talk to them about credit, help them set financial goals and dispel myths about debit cards and writing checks. Consumers can access the MoneyWi$e eLearning tool in English and Spanish at http://www.capitalone.com/financialeducation/cbt/launcher.htm.
Survey Methodology
The findings reported in this release are from an online panel survey
conducted by the opinion research firm,
No statistical weighting was accomplished as all samples were drawn at
random and designed to fall proportionally to the population of High
School students in
About Capital One
Source:
Capital One Financial Corporation
Diana Don, 212-580-0161
diana.don@capitalone.com