Date of Award


Document Type




First Advisor

Sarah E. Tinkler




As Americans have become increasingly responsible for their own financial security their ability to make financial decisions in their best interests has certainly grown in importance. The focus of this paper is to determine what role financial literacy plays in making optimal financial decisions and maintaining economic stability. Using mostly research from other studies and some original research, this paper seeks to examine the level of financial literacy among the general population and what the implications are for the general lack of literacy. What I find is that individuals who have lower levels of financial literacy generally make poorer financial decisions than individuals who are more financially literate. Given that much of the population has low levels of financial literacy and that less financially sophisticated individuals were routinely taken advantage of in the subprime mortgage crisis that nearly brought the U.S. economy to its knees, increased levels of financial literacy can clearly play an important role in reducing the likelihood of future financial crises.

Persistent Identifier


An undergraduate honors thesis submitted in partial fulfillment of the requirements for the degree of Bachelor of Science in University Honors and Economics