First-Year College Students Score Poorly in Basic Financial Literacy, Inceptia Survey Reports

Lincoln, Neb. (Jan. 22, 2013) – In a nationwide survey conducted by Inceptia of first-year college students about their financial literacy, 89 percent of respondents scored the equivalent of a “C” or below.


The Inceptia National Financial Capability Study surveyed 962 first-year students from five colleges and universities across the United States between September 2012 and November 2012. Students answered 50 knowledge questions, based on five core competencies specified by the U.S. Department of the Treasury Financial Literacy and Education Commission: Earning, Spending, Saving, Borrowing, and Protecting.


None of the students scored in the “A” range (45 to 50 correct); only 11 percent scored in the “B” range; 22 percent in the “C” range; and 67 percent either “D” or “F”. A sampling of results showed:

  • Four in 10 students did not know what the definition of “Net Pay” was.
  • Too many students could not correctly identify the kinds of items that appear on a paycheck stub.
  • Only 45 percent of students said they understand their credit score may have an impact on their ability to get a job.
  • Most students knew that the credit card companies are not the source of credit reports, but only half or less could correctly identify the credit reporting agencies.


The scores not only are disappointing, but also underscore an extreme need for financial education in higher education, said Kate Trombitas, Inceptia vice president of financial education.


“The issue of financial literacy is critical today, especially in an era of student loan default. The Department of Education recommends that schools start early in their college careers teaching students how to manage money, create a budget, track spending, compare interest rates and lenders. These are life skills students need, but we’re seeing from the survey that they don’t have a good knowledge base to work from. That’s why Inceptia is partnering with a growing number of schools around the country to address this issue.”


The survey also included questions related to self-assessment, designed to elicit current levels of confidence and attitudes toward financial management issues, and behavior questions designed to document current financial management practices:

  • 37 percent of students said that finances are a significant source of stress.
  • 60 percent of students did not create a budget for the current school year.
  • 31 percent do not regularly track expenses.
  • 70 percent of students either currently have student loans or plan to borrow before they finish school.


The goal of the National Financial Capability Study, said Trombitas, is to create a national database of institutional data regarding student attitudes about financial issues, current levels of financial knowledge and current financial behaviors.


“The results also provide an important snapshot for college campuses to see the level of existing financial literacy among first-year students and identify areas for improvement. We hope that every school takes advantage of this free service from Inceptia.”


Results of the survey will be analyzed for future use in Inceptia’s Personal Financial Management Certification program, financial education seminars and Financial Avenue, an online money management product produced and offered by Inceptia.


Inceptia encourages colleges and universities to conduct the survey on their own campuses. The survey is available at no charge to any school of higher learning that wishes to participate. The identity of individual students is kept private and schools receive an aggregate score.



Inceptia is dedicated to providing much-needed support to help schools effectively fulfill their roles and responsibilities. Our mission is to provide guidance to schools, along with the means to help their undergraduate, graduate and professional students succeed. Through comprehensive analytics, student success tools, financial education, default prevention and financial aid management, we are confident we can help all students, not just borrowers, become financially responsible adults. We are here to make it possible for more schools to launch brilliant futures. More information at