Lusardi, AnnamariaMitchell, Olivia SCurto, Vilsa2023-05-232023-05-232009-08-012019-08-23https://repository.upenn.edu/handle/20.500.14332/43694We examined financial literacy among the young using data from the 1997 National Longitudinal Survey of Youth. We showed that financial literacy is low among the young; fewer than one-third of young adults possess basic knowledge of interest rates, inflation, and risk diversification. Financial literacy is strongly related to sociodemographic characteristics and family financial sophistication. Specifically, a college-educated male whose parents had stocks and retirement savings is about 50 percentage points more likely to know about risk diversification than a female with less than a high school education whose parents were not wealthy. These findings have implications for consumer policy.Opinions and errors are solely those of the authors and not of the institutions with which the authors are affiliated. © 2009 Pension Research Council of the Wharton School of the University of Pennsylvania. All rights reserved.EconomicsWorking Paper