The 2015 National Financial Capability Study 2016 AMBA Fall Workshop August 29, 2016 Gary Mottola, Ph.D.

Agenda About the NFCS Some National Findings Better Understanding Veterans The Military Sample New Banking-Related Questions What’s Next?

NFCS Background Monitor and better understand financial capability in America Four components of financial capability National, Military, and Investor populations Designed by multidisciplinary team Three waves—2009, 2012, and 2015

NFCS Impact Hundreds of scholarly articles have referenced the NFCS Citations of the NFCS publications are commonplace Top-tier researchers continue to use the data Capture respondents’ money management cycle (sources of income, methods of receiving funds, participation in banking, methods of spending/bill paying) Revise and update mortgage section Additional debt questions 3

Key 2015 National Findings Things have improved But not for all demographic groups Financial literacy levels are flat or slightly down Capture respondents’ money management cycle (sources of income, methods of receiving funds, participation in banking, methods of spending/bill paying) Revise and update mortgage section Additional debt questions 4

Making Ends Meet In a typical month, how difficult is it for you to cover your expenses and pay all your bills? 5

Satisfaction with Finances Overall, thinking of your assets, debts and savings, how satisfied are you with your current personal financial condition? 6

Making Ends Meet by Ethnicity Difficulty covering expenses and paying bills? Not at all difficult Very difficult White Black Hispanic Asian Other

Financial Fragility by Education How confident are you that you could come up with $2,000 if an unexpected need arose within the next month? 8

Financial Literacy Five financial literacy quiz questions: Interest rate question Inflation question Bond price question Mortgage question Risk question 2009 2012 2015 Average number correct 2.99 2.88 2.82 High Financial Literacy 42% 39% 36%

Better Understanding Veterans The 2015 NFCS has 27,564 responses— of which, 3,170 are veterans Have you ever been a member of the U.S. Armed Services, either in the active or reserve component? New questions… When did you complete your service in the military? Did you retire from the military? What was your most recent military service branch or component? Capture respondents’ money management cycle (sources of income, methods of receiving funds, participation in banking, methods of spending/bill paying) Revise and update mortgage section Additional debt questions 10

Expanding the Military Sample The 2015 Military sample has 1,940 responses 1,682 Active Duty and 258 Guard & Reserve Component Army 26% Navy 9% Marine Corps 4% Air Force 11% Capture respondents’ money management cycle (sources of income, methods of receiving funds, participation in banking, methods of spending/bill paying) Revise and update mortgage section Additional debt questions 11

New Banking-Related Questions How often do you make payments using a reloadable prepaid debit card? How often do you use your mobile phone to pay for a product or service in person at a store, gas station or restaurant? Do you have a budget? In planning or budgeting saving and spending, which of the following time periods is most important to you? How would you rate your current credit record? Capture respondents’ money management cycle (sources of income, methods of receiving funds, participation in banking, methods of spending/bill paying) Revise and update mortgage section Additional debt questions 12

Next Steps for 2015 Military NFCS Analyze the military data and write the new report Update www.USFinancialCapability.org website with 2015 military data Release report and data in December 2016