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I recently joined the board of my Manhattan co-op, and I love it. One of my duties is reviewing applications for apartments, which — as both a prospective neighbor and a retirement economist — has been a revelation.
It turns out, based on not only my limited sample but also more rigorous and representative surveys, a surprising number of people have no idea what they are doing when it comes to their finances. It’s not just the young folks with their DoorDash addictions. This is a multi-generational problem that spans income and wealth groups, and it’s getting worse.
To some extent, financial illiteracy is nothing new. For decades, most people have been unable to answer basic questions about investing, and many people don’t save enough. Yet somehow they have managed to muddle through. Measures of financial well-being have been fairly stable, and people in retirement say they are content with their lifestyle.
Continue reading the entire piece here at Bloomberg (Paywall)
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Allison Schrager is a senior fellow at the Manhattan Institute, a contributing editor of City Journal, and a Bloomberg Opinion columnist.