The Philadelphia Federal Credit Union has disclosed results of its first Financial Literacy Survey, which provides insight into the saving practices, spending habits, and financial attitudes of Philadelphia-area residents.
The survey of 350 Philadelphians found that 37 percent of respondents are in critical need of improving their financial condition. For example, they were not able to save any money in the past 12 months, and 84 percent of those surveyed consider themselves less than “very knowledgeable” about personal finance.
The survey results were released in recognition of Financial Literacy Month.
Karl J. Bernhard, accredited financial educator at Philadelphia Federal Credit Union, says one alarming finding of the survey was that approximately half of the respondents have not seen a copy of their credit report within the past 12 months.
“That, for me, raises a huge red flag for a topic that needs to be addressed,” Bernhard said.
He noted that credit reports can be obtained for free due to a federal law.
“The survey findings are concerning, but we believe that education can empower Philadelphians to take control of their current fiscal condition and begin to make improvements,” he said.
“There are simple, effective steps everyone can take today to cultivate the decision-making skills necessary to bring their financial goals more within reach.”
The survey revealed several peeks into Philadelphians’ personal finance habits, including: Among those who have rent, mortgage payments and/or other loan payments, 22 percent reported being late or skipping a payment at least once during the past 12 months. The survey also indicates that 45 percent of survey respondents who have a credit card carry a balance in a typical month. Meanwhile, 79 percent of Philadelphians surveyed have been less than “very successful” at keeping spending within their budget during the past 12 months.
Spending over budget and inability to save in the short-term are not the only issues, as survey results also indicated that many Philadelphians could face significant financial difficulties during retirement years. Forty-three percent of survey respondents expect Social Security to provide a majority of their retirement income during retirement years. The survey noted that 49 percent of respondents lack confidence that they will be able to accumulate enough in savings and investments to retire comfortably at a reasonable age. However, just 16 percent described themselves as being “very confident” in that regard.
“It’s critical that Philadelphians begin to manage their money better today, so they can effectively plan for a more secure and satisfying future,” says Bernhard.
Bernhard says creating a budget is the first step that consumers can take in planning for the future.
“Track your spending, take that information and create a budget for yourself. That’s the beginning of any financial future that you are going to have,” he said.
The second step is obtaining a credit report from one of the nation’s major credit reporting bureaus.
Bernhard also says it’s important for people to seek help from agencies that can provide advice on handling finances.
“Don’t just suffer in silence, but get that assistance and that knowledge of how to handle yourself financially,” he says.
“There is a clear need for Philadelphians to make a long-term commitment to fiscal responsibility, and it’s our commitment to the community to provide the tools to help,” said James McAneney, president and chief executive officer of PFCU.
“As a not-for-profit financial institution, accessibility is one of our core values. We believe that everyone should be able to gain the knowledge necessary to establish a better financial future.”
In response to survey findings, PFCU is offering free financial education seminars now through May. A budgeting and credit seminar will be held April 17 at 6 p.m. at Katherine Drexel Branch Library, 11099 Knights Road. A home buying seminar will be held April 18 at 6:30 p.m. at Chestnut Hill Branch Library, 8711 Germantown Avenue. A budgeting and credit seminar will be held April 28 at 10 a.m. at Charles Santore Branch Library, 932 South 7th Street. A budgeting and credit seminar will be held May 22 at 6 p.m. at Ramonita de Rodriguez Branch Library, 600 West Girard Avenue.
To register for the seminars, visit http://bit.ly/GW32eK.