Study: 19 Percent of Americans Spend More Than They Earn

Most U.S. adults don’t do well on a short multiple-choice quiz about basic financial literacy.


Fewer than half of Americans are spending less than they earn, according to a new study.

“Just over two-fifths of respondents (41%) report spending less than their income, 36% spend about equal to their income, and 19% spend more than their income,” says the FINRA Investor Education Foundation survey.

The survey included 25,509 adults, which was about 500 people per state, plus Washington, D.C. Here’s what else it found:

  • 56 percent don’t have three months’ worth of expenses saved up in case of emergency.
  • 34 percent of adults make only minimum credit card payments.
  • 31 percent of adults under age 35 have unpaid medical bills, compared with 17 percent of those age 55 or older and 26 percent of all adults.
  • People in California, Massachusetts and New Jersey are the most “financially capable”; those states ranked in the top five on at least three of five measures of financial capability.
  • People in Mississippi are the least financially capable; the state ranked in the bottom five for nearly all measures. Arkansas and Kentucky weren’t far behind.
  • 61 percent got three or fewer correct answers on a five-question quiz about financial literacy given as part of the survey.

You can see findings specific to your state and see how it compares with the national average. You can also try to answer the five basic financial literacy questions that were presented to participants. The national average was 2.88 correct answers, and only 14 percent got them all right. Can you?

Stacy Johnson

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