For years, financial literacy has seemed like a minor concern compared to more urgent problems facing the nation. In the aftermath of the financial crisis, however, the issue is now getting a lot of high-profile attention.
According to a recent Forbes article, the Obama administration is now committed to educating Americans in saving and investing, following the worst economic crisis since the Great Depression. The U.S. Treasury and Education departments announced plans to improve financial education for high school students, focusing their efforts on poorer neighborhoods with few financial services.
The impetus for this newfound commitment came on the heels of a survey from the Financial Industry Regulatory Authority and the Investor Education Foundation, showing that young adults display much lower financial literacy than older generations. The proof is unfortunately in the pudding when you look at the decline in the U.S. savings rate: According to the Bureau of Economic Analysis, the national savings rate was above 10% as recently as 1985, but fell below 1% several times in recent years before climbing back to an average of between 4% and 5% in 2009.
Now, some well-known corporations like Bank of America (NYSE: BAC ) , Charles Schwab (Nasdaq: SCHW ) , JPMorgan Chase (NYSE: JPM ) , Allstate (NYSE: ALL ) , McGraw-Hill (NYSE: MHP ) , and Ford (NYSE: F ) have dedicated philanthropic efforts to financial literacy. But increased government involvement will only help as it attacks the problem on a new front.
At the Fool, we applaud all these efforts as we embark on our own philanthropic mission to spread financial education, via our annual Foolanthropy campaign. We're thinking globally and acting locally, by "adopting" a D.C. public charter school and pledging to donate $0.10 for every article comment, blog post or comment, and discussion board post throughout the campaign. We'll also organize employee volunteers and teach financial literacy workshops to students and parents.
The campaign has certainly taken off in the CAPS community, generating over 2,000 comments on one particular blog post, setting a new record for the Fool. We've also solicited some great financial advice prompted by our CEO, Tom Gardner.
So let us know what you think in the comments box below (you'll add another $0.10 to the campaign!). Will the government's plan have an impact, or are we, as a nation, a hopeless case of overspenders and undersavers? What advice would you give to the next generation of consumers?