IT'S TIME FOR AMERICANS TO BECOME MORE FINANCIALLY LITERATE, AND ACCOUNTANTS CAN HELP THEM DO SO.
No nation, regardless of its economic model, can afford to waste capital, and yet that’s exactly what we in the United States are doing through our national financial ignorance.
Many Americans lack the basic skills necessary to balance a checkbook, and our degree of financial illiteracy manifests itself in a crushing burden of credit card debt and an inability to manage defined contribution retirement plans.

During 2005, it actually resulted in Americans spending more than they earned. Remarkably, this  pattern of dissaving hadn’t occurred since the Depression era of the 1930s. Furthermore, the number of individual bankruptcies doubled over the 10-year period ending in 2004 when approximately 1.59 million Americans filed for bankruptcy protection and we witnessed a frantic rush to reform bankruptcy law. Sadly, far too many Americans no longer consider carrying huge amounts of debt to be the embarrassment it was just 50 years ago.
Taken together, these problems can’t bode well for our economy, yet too many Americans seem  oblivious to the impending crisis our excessive borrowing creates (and we aren’t talking about the subprime mortgage crisis).
But educated Americans haven’t always been financially illiterate. Throughout the 19th Century, the most popular numerical primer, Ray’s Practical Arithmetic, used in grades five and six, included challenging problems that introduced the concepts of simple interest, compound interest, discounting notes at a bank, foreign exchange, insurance settlements, taxation, partnership interests, and  bankruptcy. During grades seven and eight, Ray’s Higher Arithmetic expanded on these topics and introduced the students to the concepts of profit and loss, issuance of stocks and bonds, premium and discount on bonds, and brokerage commissions.

BACK TO BASICS
Unfortunately, the educational community began abandoning Ray’s Arithmetic during the 20th  Century, and most students today aren’t exposed to the fundamentals of financial literacy. We have, however, witnessed a concerted effort during the past 10 years by various government,financial, and even charitable organizations to increase the financial literacy of all Americans.Among the not-for-profit entities addressing this is the Jump$tart Coalition for Personal Financial Literacy (www.jumpstart.org).

Jump$tart’s primary mission is coordinating the efforts of the other organizations that provide  information and instruction to those who need to improve their financial literacy. It also supplies financial education materials for grades K through 12 and has developed 12 “must-know” principles of personal financial management for young people. (You can find these principles at  www.jumpstart.org/principles.cfm.)

These principles have become benchmarks for measuring the financial literacy of primary and secondary students in the United States.

In addition, Jump$tart administers a biennial survey that measures the financial literacy of high school students throughout the nation. Since 1997, almost one-half of the students have shown themselves to be incapable of balancing a checkbook or correctly answering general questions regarding earning, spending, saving, and investing money.

Furthermore, Jump$tart has discovered that far too many young people fail to prudently manage their first consumer credit experiences, are prone to developing (This article summary only, to get the full text please login or register, and use contact form)