Americans (Still) Don’t Understand Investing Basics

Greetings,

We Don't Need No Education...

It’s been seven years since the Securities and Exchange Commission published, in a report on financial literacy, a review of numerous surveys on the topic of personal finance. “U.S. retail investors lack basic financial literacy” and “have a weak grasp of elementary financial concepts,” the report concluded.

Later in 2011, the Council for Economic Education published a study that found as a nation, 46 states include personal-finance education in state standards, but only 13 states require students to take a personal finance course in High School.

A major problem is that teachers aren’t confident about their own money skills. When asked about six personal-finance concepts, fewer than 20% of teachers said they felt “very competent” to teach those topics, and one of the areas they reported feeling least competent about was saving and investing, according to a 2009 survey of 1,200 K-12 teachers published by the National Endowment for Financial Education.

In summary, most Americans still don’t know the basics of investing.

We don’t learn about investing in school. And yet, when we get a job we’re encouraged to let others invest for us through 401(k) plans and mutual funds. This mistake leaves your money in the hands of someone who probably isn’t much more literate when it comes to investing.

Until we decide to take matters into our own hands, and start taking our financial education seriously, we will continue to see results similar to these surveys. The key to building great wealth is having great knowledge to act on and great wisdom to know which course is the best.

This kind of knowledge and wisdom only comes through a high financial intelligence gained from committing yourself to financial education.

This is what makes Rich Dad different.

Sincerely,
The Rich Dad Company

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