Are We a Nation of Financial Illiterates?

The Freakonomics column in the New York Times is often entertaining, and sometimes willing to stray from conventional wisdom. Today's column is one such, Are We a Nation of Financial Illiterates?" It answers the question in the affirmative, as one would expect. I was surprised, however, by just how trivial were the questions that so many are unable to answer.

Given that too many know too little of financial basics, what should be done about it? As Stephen Dubner asks it,

what good is it if high-school students learn about Flaubert, biology, and trigonometry if they don’t learn how to take care of their money?

He puts the question to Dartmouth prof Annamaria Lusardi, who is making a career of studying financial literacy. She advocates for more financial education in high school (without displacing any existing courses, please), and by the well-trained (no gym teachers need apply, naturally). Yet she also wants to exclude anyone connected with the financial services industry from the process! ("It is a problem of incentives"; spoken like an academic.)

Looking at the problem another way, the authors' have suggested that fully one-third of Americans are financially literate already. Presumably that group includes 100% of the prospects for trust services. How should that datum factor into trust marketing plans?