The staff of the U.S. Securities and Exchange Commission just released a study regarding financial literacy among investors as required by section 917 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Studies reviewed by the Library of Congress indicate that U.S. retail investors lack basic financial literacy. According to their research, the most effective existing private and public efforts to educate investors include programs that are:
- Goal oriented
- Emphasize important investor education concepts
- Easily accessible
- Delivered efficiently
- Relevant to their target audience
- Targeting specific groups including young investors, lump sum payout recipients, investment trustees, the military, underserved populations, and the elderly
- Promoting the importance of checking the background of investment professionals
- Promoting Investor.gov as the primary federal government resource for investing information
- Promoting awareness of the fees and costs of investing
Click here to read the full SEC report.