Consumers Overestimate Their Financial Knowledge -- and Pay the Price: Zolo Report

New report reveals how the majority of North Americans are confident about their financial well-being, even after failing a basic financial literacy test

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Zolo

Nov 13, 2020, 08:36 ET

VANCOUVER, BC, Nov. 13, 2020 /PRNewswire/ -- A new report, released by Zolo, the largest tech-driven real estate marketplace, clearly shows how much North Americans overestimate their financial knowledge.

The report asked 6,551 North Americans to rate their knowledge, confidence and skills when it comes to managing their finances. While the majority (70%) of North Americans felt confident about their financial knowledge, when tested the results showed a surprising lack of money management skills:

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While confidence in money is high, new data from a Zolo report shows that only a little more than half of North Americans would pass a basic financial literacy test.
While confidence in money is high, new data from a Zolo report shows that only a little more than half of North Americans would pass a basic financial literacy test.
Desire for homeownership is stronger since start of pandemic, according to new data report from Zolo.
Desire for homeownership is stronger since start of pandemic, according to new data report from Zolo.

  • Only 54% passed the basic financial literacy test;
  • 78% said they'd run out of money in 90 days or less if they lost their job today;
  • 77% choose to stop saving for retirement in order to buy a home sooner.

Further insights show how difficult it's been for many North Americans over the last 12 months:

  • 55% were behind two or more consecutive months in paying a bill;
  • 47% were behind two or more consecutive months in making a loan payment or paying their rent or mortgage.

Infographic is available here or download all media files and use (with attribution) here.

"Developing good money-management skills, like budgeting, are critical to financial well-being," explains Romana King, personal finance expert at Zolo Homebase. "Without basic financial literacy skills, people make money decisions that end up costing them now and in the future."

Financial literacy and financial sufficiency are closely linked and the data from this report helps highlight the need — and urgency — for ongoing financial education.

This is particularly important for millennials who are looking to purchase their first home or for North Americans struggling with financial hardship. According to the new report, almost three-quarters (74%) of North Americans confessed that their desire for homeownership increased since the start of the pandemic, while 32% admitted that money was a concern on a daily basis.

Survey Details
The survey data was collected through an online survey between September 19 to October 12, 2020, where 6,551 respondents answered questions that were integral to financial literacy. The estimated margin of error is +/- 1.59 percentage points, 19.8 times out of 20 (99%).

Read a summary of the report online at Zolo Homebase.

About Zolo 
Zolo is one of Canada's most popular national real estate marketplaces. Each month more than 10 million home shoppers use Zolo to buy, sell, rent, finance, and learn about real estate.

Born as a digital-first company, Zolo gives Canadians access to real-time data, market updates and listing details, and connects clients with real estate professionals throughout the entire home buying, selling and rental process.

For media inquiries, contact Nicole Sullivan, outreach specialist, [email protected] or 416-895-5407.

SOURCE Zolo

Related Links

https://www.zolo.ca/

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