Not all states are created equal. Especially in how their residents manage money.
The kind folks at GOBankingRates.com looked into this aspect of financial literacy from top to bottom, checking out every state in the Union, along with D.C., and figured out where people were the smartest, moneywise.
They also figured out where they were, well, not quite so money-smart in each of three categories: use of banking services, saving and investing behaviors, and financial education policies within the state (or District).
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They pulled their data from some pretty impressive sources: the FDIC, FINRA, the Urban Institutes, and the Council for Economic Education.
Every state was ranked on how it fared in several different areas:
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the number of unbanked/underbanked households
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households reporting spending below, at or above their earnings
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delinquent debt and debt in collection
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the use of alternative financial services
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investments in stocks, bonds and mutual funds
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the number of households having emergency funds
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the number of households having retirement accounts
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the number of households declaring bankruptcy
Ready to find out if your state is one of the quick ones, or one of the less financially astute?
Read on to see the 10 least money-smart states. For the 10 most money-smart states, click here.
1. Mississippi
Mississippi may have a low cost of living, but that doesn't mean its residents aren't struggling financially.
Of course it's rife with unemployment and poverty, bringing it the dubious "honor" of being the poorest state in America in a 24/7 Wall St. survey just this year.
But its financial problems go deeper than that. Even those who are working aren't managing their money well—despite the fact that the state ranks better than many others on financial education.
But Mississippi has the fewest households with investments and the most with no emergency fund (64 percent have no rainy-day fund to fall back on).
In addition, 47.3 percent of households are unbanked/underbanked, the highest rate in the country. Another bad highest: those who rely on pawnshops, payday loans and the like, at 40.5 percent.
And a bad lowest—well, second lowest in the country: only 46.9 percent of Mississippians have savings accounts. That's fewer than half.
2. Arkansas
The Natural State appears to be unnaturally poor, with 38 percent of its residents not having access to sound financial services and instead relying heavily on those nasty alternatives–34.4 percent of Arkansans hit the rent-to-own shops and pawnshops instead of saving or borrowing at a bank.
Maybe it's no surprise, considering that the state has the fewest residents with savings accounts: just 45.6 percent.
Twenty percent of Arkansans are living beyond their means, and only 63 percent have retirement plans.
While its schools are required to give courses in economics, personal finance isn't on the priority list—so no wonder folks aren't doing all that well at managing what they have.
3. Nevada
Not only is the state rife with opportunities for people to lose their money just walking down the Strip, Nevada has a poor financial education record—and a lot of other "poors" as well.
It's the second worst in the country for saving and investing, and it's tied with Hawaii for the most households who spend more than they earn, at 23 percent.
Logically enough, that leads to another bad rating: 52.3 percent of Nevadans have debt that's either delinquent or in collection.
They also have the highest balance of debt in collections, at $7,198.
4. Kentucky
Start off with the fact that Kentucky has standards for economics and personal finance courses but doesn't require schools to offer such courses, and you can see why the state's residents may have some financial woes.
Sixty-two percent have no emergency savings; for that matter, only 53.5 percent of Kentuckians have savings accounts at all.
In addition, the state has a high level of debt delinquency, lacks retirement savings plans, and has few residents who own investments.
They don't do so well on being banked, either, with 29.9 percent relying on alternative financial services like check-cashing places or refund anticipation loans.
And even among those with incomes that top $75,000 per year, 16.6 percent use alternatives rather than actual banks.
5. Oklahoma
Lack of savings accounts, with just 56.9 percent of its residents having one, means that Oklahoma isn't exactly at the top of the heap in financial know-how.
Thirty-two percent of Oklahomans have overdue medical debt, 20 percent spend more than they make, and 59 percent have no emergency fund.
Add to that the fact that high schools don't have to offer economics, despite having a standard financial curriculum, and that its savings and investing behavior is below average (though closer to it than its savings account record), and you have a bunch of reasons why Oklahomans aren't as financially adept as some of their countrymen.
6. Kansas
Kansas doesn't know, and doesn't want to know, about financial preparedness—its educational requirements on economics and/or personal finance are not just bad, they're nonexistent.
So it's not surprising the state ended up in the bottom 10.
In addition, Kansans overall are the most unbanked/underbanked, and that means a heavy reliance on payday loans, pawnshops and rent-to-own stores, as well as check-cashing shops and other alternative financial services.
Kansas ranks poorly in both saving and investing, and 21 percent of its people spend more than they earn.
7. Alabama
Alabamans will be in trouble come retirement time, because only 59 percent of them have a plan for retirement.
Worse still, just 29 percent have investments—and with the second highest rate of bankruptcy in the country in the second quarter of this year, at 5.13 per 1,000 people, it's pretty obvious that financially, life is tough for folks here.
The state does have laws requiring high schoolers to take classes in economics and personal finance, but that doesn't seem to have made much of a dent in a population that has high rates of unbanked and underbanked households and relies heavily on the use of alternative financial services.
8. District of Columbia
Okay, okay, so D.C. isn't a state—but you might think that the municipality that hosts the seat of the federal government might be more money-savvy than it is. Or not.
Anyway, while D.C. does have standards spelled out for economics courses, it lacks anything similar for personal finance—and high schools don't have to offer those classes anyway.
Then there's the little matter of the unbanked/underbanked, with 36.6 percent of residents lacking the essentials in conventional financial services and therefore turning to those nasty alternatives.
What D.C. does have, on the positive side, are high rates of enrollment in retirement plans and investments in stocks and bonds, which mitigate the picture ever so slightly—just not enough to get it out of the bottom 10.
9. South Carolina
Maybe they just don't trust banks in South Caroline.
That could be why the state has a 36.1 percent rate of unbanked/underbanked residents, and why 32.3 percent of residents rely instead on their friendly pawnbroker and payday loans.
And that could explain why only 58.2 percent have savings accounts; the money just never makes it that far.
Low savings and investing habits don't help, and the state has the worst record of debt in collections (46.2 percent) and in delinquency (6.5 percent) in the country.
And only 55 percent of South Carolinians have retirement plans—not a good harbinger for those golden years in a state where lots of folks would love to retire.
10. Ohio
Another state that doesn't know and doesn't want to know–Ohio has no financial education standards, either, nor a requirement for students to learn about money.
Both bankruptcy and debt delinquency are higher than average here, and 27.2 percent of residents are unbanked/underbanked.
Seventeen percent have spent more than they earned, and 27 percent have overdue medical bills. That's just medical bills, no other debt.
In addition, 58 percent have no emergency fund and 41 percent were only paying the minimum on their credit cards—with 31 percent seeking out other places to borrow money than banks, such as pawnshops and auto title loans.
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