How financially literate are Mainers?

The free-credit-score website WalletHub today released its report on 2017’s Most & Least Financially Literate States. We’ll dive into how Maine did in a few moments, but here’s my first concern with the survey — the rankings go from 1 – 51, and last I checked there are only 50 states. So, I’m a little dubious of the accuracy of these results…

Oh, now that I’m actually *reading* the report, I see the District of Columbia is included. I dunno — DC isn’t a “state,” right? Don’t their license plates display the motto “Taxation Without Representation?” Aren’t DC and Puerto Rico duking it out over which one of them should become the 51st state?

Anyway — you can read in the report’s “Methodology” section how WalletHub conducted its assessment. Let’s go to the video tape… er, I mean — let’s examine Maine’s performance:

Maine ranked 4th overall (behind New Hampshire, Minnesota and North Dakota). Not too shabby, eh? There are a number of breakouts included the report; here is Maine’s performance in a few of them along with my explanations:

5th – WalletHub’s ‘WalletLiteracy Survey’ Score

  • You can take the survey here. I just took it and my grade was A-minus. I missed 4 out of 30 questions: I was wrong about how to rank sources of lending for higher education from best to worst, misunderstood when I would start being charged interest on a new purchase if I carried over a balance on my credit card, and incorrectly answered the questions about my age and gender.

7th – % of Adults Aged 18+ Who Spend More than They Earn

  • I’m not sure if this means Mainers are the seventh-highest in the nation at spending more than they earn? Seems like it’s better to be ranked higher as someone who spends less than they earn, no?

3rd – % of Unbanked Households

  • These are people who are very poor pool players.

5th – % of Adults Aged 18+ Who Borrow from Nonbank Lenders

  • “Nonbank” lenders are financial institutions that make only loans; they don’t offer savings or checking accounts. Examples of nonbank lenders are: Quicken Loans, Freedom Mortgage, and your father’s wallet while he’s in the shower.

15th – % of Adults Aged 18+ Who Scored at Least 80% on FINRA’s Financial Literacy Test

  • Another test! It’s much shorter and (I thought) easier than the WalletLiteracy Survey; I got 6 out of 6 (#6 was a bonus question; I knew the name of both actors who played Darren on Bewitched), but again I have a concern with the methodology, since on my results page the nice folks at FINRA (motto: “It’s pronounced ‘FIN-ruh’!”) seemed to think I was taking the quiz in Alabama.
  • It does seem odd that Mainers did better on the more comprehensive WalletLiteracy Survey than on FINRA’s simpler test. Maybe this was just because we didn’t completely fill in the little ovals using a #2 pencil.

23rd – % of Adults Aged 25+ with at Least a Bachelor’s Degree

  • I am 25+ (plus plus plus…) and do not have a Bachelor’s Degree. This is largely because I have been married since 1981.
  • While I hold higher education in great esteem, and have respect for those with advanced degrees — some of the people I know with the absolute worst ability to manage their finances have MBA’s and Ph.D’s. Go figure.

Now that we are armed with these insights, let’s see how we improve in the rankings on next year’s report. My money’s on Maine walking all over North Dakota to take over the #3 slot; anyone reading this want to get a piece of that action? It’s a sure bet.

All photos courtesy of Pixabay

John Branning

About John Branning

Besides what I contribute here, you can also ignore some of my earlier posts by not visiting my website, www.FactsOptional.com, as well as by not downloading a copy of my e-book “Selfie-Facing: Analog Musings in a Digital World,” which made the list of "The Best Self-Published Books of 2016" as seen on the Huffington Post.