Website ranks Mississippi low in terms of financial know-how

Internet rankings may not always be official, but they do often shed light on serious issues within a state. Recently, the personal finance site WalletHub ranked the state of Mississippi near the bottom of all 50 states regarding its level of financial literacy. According to the website, it reviewed consumer habits and financial education programs throughout the United States, and found that Mississippi seems to trail the rest of the country when it comes to personal finance knowledge.

The specific results mention that Mississippi ranks second-to-last in terms of the amount of people who spend more money than they bring in and lack an emergency fund. The state is also in 49th place for those who don't have a bachelor's degree. In addition, the Magnolia State also has the most high school dropouts nationwide and is in the bottom five of states whose residents borrow money from lenders who are not banks.

Lack of financial literacy, of course, can lead to all sorts of financial challenges. Overwhelming debt can lead to personal bankruptcy and unexpected life changes can be handled incorrectly if one doesn't understand all the financial implications. Still, if young Mississippians aren't taught financial literacy early on, it's no surprise that they may not be well-versed in the subject later in life. Thanks to student loans, many residents are seeking debt relief at younger ages than in the past, which is why financial literacy is so crucial for residents of all ages.

Fortunately, Mississippi ranks at position 21 in terms of high school financial literacy initiatives. Hopefully, this means that upcoming generations will receive more education than state residents have in the past. The financial world abounds with not only a lack of knowledge, but also misconceptions that can harm those who haven't received the proper education. For example, many don't know that bankruptcy doesn't mean the filer will "lose everything;" some forms of bankruptcy allow the filer to keep certain assets. Another myth is that bankruptcy ruins a person's credit forever. Nowadays, it is quite possible to rebuild credit gradually, but faster than one might expect. A qualified bankruptcy attorney can address these misconceptions and more as a debtor seeks more individualized financial eduation.

Source: The Clarion-Ledger, "Report: Mississippi lacks lifelong financial skills," Jeff Ayres, April 23, 2014

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