WASHINGTON (4/4/12)--More than half of U.S. adults--56%--admit they do not have a budget, according to the 2012 Financial Literacy Survey, released Tuesday in recognition of April as Financial Literacy Month.
The survey was conducted by the National Foundation for Credit Counseling (NFCC) and the Network Branded Prepaid Card Association (NBPCA). In its sixth year, the survey provides annual data and trending about Americans' attitudes and behaviors related to personal finance.
The survey revealed "a disturbing lack of basic financial skills that are critical to building a stable financial future," said the two organizations.
Among other findings:
- One-third of U.S. adults, or more than 77 million Americans, do not pay all their bills on time;
- Thirty-nine percent of adults carry over credit card debt from month to month;
- Two in five adults save less now than they did one year ago, and 39% do not have non-retirement savings;
- Twenty-five percent of those without non-retirement savings said that if they did begin to save, they would keep their savings at home--in cash.
"This year's survey unveiled some disturbing trends, showing that a significant number of Americans are saving less, spending more and carrying credit card debt over from month to month, suggesting that the painful financial lessons of the past are quickly being forgotten," said Susan C. Keating, NFCC president/CEO.
"Coupled with the two in five adults who gave themselves a C, D, or F on their knowledge of personal finance, the need for an increase in financial education becomes not only clear, but urgent," she added.
For the first time, the survey evaluated responses related to prepaid debit cards. Those findings include:
- Thirteen percent--roughly 30.5 million Americans--typically use prepaid debit cards to pay for everyday transactions such as groceries, gas, dining out, paying bills and shopping online.
- Seventy-eight percent of adults who use prepaid debit cards for everyday transactions say they use them because they are convenient;
- Seventy-three percent use prepaid cards because they believe the cards are safer than carrying cash;
- Seventy-two percent use prepaid cards to avoid overspending or spending money they don't have; and
- Fifty-six percent said that the cards help them manage their money better.
"Consumers feel empowered using prepaid debit cards and revealed in the NFCC/NBPCA survey that the top three reasons for using the cards were their convenience, safety and ability to control spending," said Kirsten Trusko, NBPCA president/executive director.
"Additionally, about three in four prepaid debit card users indicated they believed prepaid cards are a better value for their money compared to a credit card or debit card connected to a traditional bank account," Trusko added.
The telephone survey was conducted by Harris Interactive between March 14 and March 19 among 1,007 adults age 18 or older. Of those, 89 use prepaid debit cards.