Little Financial Education and Lots of Stress Among Native Americans

Native Americans are more likely to have high levels of economic stress than other demographic groups, new research shows. For many, that contributes to an enduring cycle of poverty.

While a number of socioeconomic, cultural and political factors account for Native Americans’ money struggles, high-cost borrowing including payday loans, poor retirement and college savings and general lack of financial education are seen as the biggest issues.

The Finra Investor Education Foundation and First Nations Development Institute partnered in the research, which found that certain groups within American society have experienced little to no financial gain since the Great Recession. Native Americans were at the top of the list.

Only 64% of Native Americans and Alaska Natives have a savings account, money market fund or CD, the study found. That compares to 68% of African-Americans, 79% of Asian Americans and 77% of Caucasians.

The borrowing habits documented in the study suggest a serious lack of financial education. Some 37% of Native American households, for example, have used high-cost alternative borrowing methods, such as payday loans, within the last five years. Native Americans are less likely to have money saved for college and only a quarter would be able to find $2,000 in 30 days in the event of a financial emergency.

A bright spot in this seemingly bleak prognosis is that financial education is seen as the key to turning things around. “Effective financial education programs, coupled with access to affordable financial products and continued economic growth, could improve the financial capability of native peoples,” says Finra Foundation President Gerri Walsh.

Only 32% of Native Americans said they were setting aside money for their children’s college education, vs. 39% of both African-Americans and Caucasians. Some 33% of Native Americans have tried to figure how much to save for retirement, vs. 35% of Hispanics, 36% of African Americans and 41% of both whites and Asian Americans.

“As native nations continue to experience economic growth and per capita incomes continue to increase for native people, financial capability may improve,” the study concludes. “However, the findings in this brief suggest there is still much work to be done to help increase the financial capability of (native) peoples and provide opportunities for financial education and financial inclusion.”

cenforce 100 mg More on Native Americans’ and financial literacy:

Tribe Betting on Financial Education to Protect Youth

Education, Region and Sex Weigh on Financial Education

Posted in Policy & Government on May, 2017