Table 3.

Financial literacy, trust, networks, and time preferences

% sample	All groups 100%	Non-Hisp Whites 60%	Hispanics 22%	Non-Hisp. Blacks 16%	Unbanked 26%	Underbanked 16%	Frequent AFS users 26%	Fully banked 58%
Financial Literacy
Division correct	0.88	0.91	0.88	0.77	0.76	0.90	0.86	0.93
Inflation correct	0.34	0.44	0.22	0.18	0.20	0.30	0.27	0.42
Interest correct	0.91	0.94	0.89	0.82	0.83	0.89	0.89	0.96
Interest 2 correct	0.50	0.59	0.38	0.34	0.37	0.51	0.47	0.57
Compound interest correct	0.30	0.35	0.26	0.21	0.27	0.32	0.32	0.32
High return high risk correct	0.77	0.82	0.67	0.70	0.60	0.77	0.78	0.85
Inflation defitition correct	0.79	0.83	0.72	0.73	0.65	0.88	0.80	0.83
Diversification correct	0.60	0.69	0.48	0.45	0.39	0.64	0.59	0.69
Real interest correct		0.69	0.46	0.40	0.40	0.58	0.54	0.67
Stock versus mutual fund correct	0.40	0.45	0.35	0.28	0.26	0.39	0.33	0.46
Total number of correct answers	6.08	6.70	5.31	4.87	4.74	6.17	5.86	6.69
Trust in Financial Institutions Stock Market	0.06	0.05	0.08	0.09	0.06	0.05	0.05	0.07
Banks	0.40	0.40	0.45	0.32	0.15	0.46	0.34	0.49
Insurance Companies	0.19	0.19	0.18	0.20	0.12	0.24	0.21	0.21
Stock Brokers	0.04	0.03	0.07	0.03	0.05	0.03	0.03	0.04
Financial Advisers	0.09	0.08	0.11	0.07	0.07	0.08	0.07	0.10
Total trust index	0.78	0.76	0.87	0.71	0.45	0.86	0.69	0.90
Networks
Network: friends and family	0.14	0.11	0.18	0.23	0.37	0.11	0.20	0.06
Network: stores	0.09	0.05	0.12	0.20	0.16	0.12	0.15	0.05
Cost Knowledge
Payday loans expensive	0.66	0.78	0.50	0.48	0.46	0.68	0.64	0.75
Less money pawnshop	0.69	0.72	0.65	0.66	0.64	0.75	0.76	0.70
Time Preferences
Present biased	0.12	0.11	0.12	0.18	0.19	0.10	0.14	0.10
Future biased	0.28	0.30	0.25	0.24	0.18	0.31	0.28	0.31
Observations	1576	341	854	285	407	307	490	853

Notes: Authors’ calculations using ALP data, survey 276. Sample restricted to families with less than 50 K in anual income. Means calculated using sample weights.