In modern era, finance has become a major source in an individual’s life. But not all the citizens are well known to financial literacy. This study belongs to the two major components and the first one is to assess the individuals that how they make complex decisions in house and second one is to assess the effects of financial education on behaviour specially economic decision making. No doubt, most of the families are struggling with the currency issues and they need to literate just to secure their future. So, to spread awareness among residents, American government has taken a initiative by conducting a survey named as consumer financial protection bureau(CFPB).
The pivotal focus of CFPB mission is to educate and empower the consumers to control their lives in terms of money. This survey includes the CFPB’s scale to measure the financial well being for a sample on national level of youth of American population. This survey also includes the measurement of the individual and household characteristics, employment and income, safety nets and savings, financial experiences and behaviours, attributes and skills that have been noticed to influence adults level of financial well being. This survey was conducted in English and Spanish through internet between 27th October 2016 and 5th December 2016. The total surveys were 6394 from which 5395 were a general sample of the population and 999 were done among old age people like above 62 years old. Moreover, the purpose of survey to represent the adults population of the almost 50 states of America. The questionnaire was sent to GfK Knowledge Panel®. The Knowledge Panel sample is recruited using address-based sampling and dual-frame landline and cell phone random digit dialing methods.
The primary objective is to develop a country with financial wealth and economicaly vulnerable individual. According to report of Financial Well-Being, the information is descriptive and that is defined by the subgroups like (1) individual characteristics; (2) household and family characteristics; (3) income and employment characteristics; (4) savings and safety nets; (5) financial experiences; and (6) financial behaviours, skills and attitudes Second , the survey focused on the control over social context and personal triats. A quantitative understanding of the most important drivers of financial well-being and how these drivers work together to produce financial well-being, supports the development or prioritization of efforts to improve financial outcomes. At last, public use file is produced and compared with other surveys. We hope that the initial descriptive statistics presented in Financial Well-Being in America, along with the PUF, will engage a broad range of researchers and policymakers in identifying the factors that drive the financial well-being of consumers, and promoting successful programmatic and policy approaches for doing so.
To begin, Remund 2010 provides a useful definition of financial literacy: “Financial literacy is a measure of the degree to which one understands key financial concepts and possesses the ability and confidence to manage personal finances through appropriate short-term decision-making and sound, long-range financial planning, while mindful of life events and changing economic conditions.” This statement suggests that understanding the financial issues are critical matters.
In terms of safety area, clients need to propagate that marketplace effectively. Numerous provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) charge the Bureau with working to improve the financial literacy of consumers in America.
Lusardi and Mitchell 2011 discuss the retirement plan of the citizens of the America . according to them who are well known to the financial literacy , they are more secure in their old age. That means they have already planned their future.however, in the youngsters, women and less literate folks are not confronted with the financial literacy term.due to this, in the real world only few people are able to make the complex financial decisions and execute them.the authors in 2013 descibed the descriptive model and come up with few predictions and first is from so long far the most fine routes to be financialy literate is hump shaped during the full life cycle. Second prediction was that this way costs lots of money consumption and time and the results would not be thT EDUQUte which are required. At last, they concluded that every individuals personality is different in terms of education and financial status because of the different life cycles.