Why financial literacy? And what can you do now?

Financial literacy is seriously lacking in every income group in America. Family deficits, lack of savings and planning for retirement, college student credit card debt and students' poor performance on finance-related tests indicate an emerging crisis.

Americans spend $1.22 for every $1 they earn, according to the U.S. Commerce Department of Economic Analysis.
Fifty-five percent of American workers have no idea how much they will need to save to make their retirement dreams a reality.
Social Security covers only 40 percent of the retirement expenses for the average American.
More than one-third (36.1 percent) of Americans report that they do not use a budget to manage their family’s expenses.
The average American household with at least one credit card carried a balance of $7,942 in 2000.

The statistics for young Americans are just as staggering:

Young Americans now have the second highest rate of bankruptcy, just after those aged 35 to 44. (That's according to Demos, a public policy research organization.)
The average college student who takes out student loans graduates $20,000 in debt and with about $2,000 in credit card debt. (Demos)
Between 1983 and 2001, credit card debt for 25- to 34-year-olds nearly tripled, according to the Federal Reserve, from $3,989 to $12,000. (Demos)

Alarmed by these statistics, the accounting profession has pledged the support of the country’s CPAs to help Americans become more financially astute. That's why the MACPA is joining the AICPA's nationwide effort to improve financial literacy for students and their families.

Want to play a role in this important initiative?

Here are 10 things a CPA can do to improve financial literacy in Maryland.

Sign up to participate in the MACPA financial literacy program.
Volunteer to speak at a local high school, college or university. For details, contact Richard Rabicoff, the MACPA's Career Initiatives and Public Relations manager, at (800) 782-2036, ext. 318, or richard@macpa.org.
Share personal finance information materials with friends, family, co-workers and clients. Here's how:

Plan to address your religious organization or community group on topics of personal finance. Resources are available.
Offer pro bono tax and planning services to lower-income individuals in your community.
Write a brief article on a personal finance topic for an organization newsletter, community newspaper or other publication. The MACPA can provide information and resources.
Get involved in Junior Achievement. Go here to volunteer.
Participate in Maryland Saves, a non-profit organization devoted to financial literacy.
Get involved in local efforts to improve financial literacy in the community and the public schools.
Teach your children everything you can.