Could You Pass the Stanford Financial Literacy Test?

The Big Three, a financial literacy test developed by Stanford University, has a pass rate of 28%.

The test is only three questions, yet just around three quarters of Americans don’t pass it, according to FINRA Foundation's 2024 National Financial Capability Study. 

Financial literacy is arguably one of the most important tools of any household. It’s what allows users to budget correctly, allocating money for bills, savings or investments. 

Individuals in control of their financial literacy hold the key to understanding a financially secure future. 

The test is currently used by the Organisation for Economic Co-operation and Development, which works with over 100 countries globally to build what it terms as “build stronger, fairer and cleaner societies”.

Workplace finance provider Stream has pledged to help one million UK workers improve their financial literacy to pass the Stanford Financial Literacy Test (SFLT).

How can workplaces begin to support financial literacy?

Stream is a financial wellness software that is used by major names such as the NHS, Asda, Dominoes, New Balance, Burger King, Fortnum & Mason, Greene King, Next, Evri, Superdrug, Hilton, Bupa U, Dollar General and Unicef. 

The company delivers “fair” financial tools exclusively through employers, it says. 

Recent research from CIPD shows that 31% of employers can currently link benefits to business outcomes. 

Stream’s initiatives focus on encouraging users through a virtual coach, taking into account unique financial situations, behaviour and individual goals.

“Workers are grappling with rising household costs and depleted financial resilience. It’s not just about increasing the money coming in – people need well-designed, accessible and affordable financial tools and the knowledge and confidence to use them," says Peter Briffett, CEO and Co-Founder of Stream.

“Most adults never received this education at school or university, and these tools will help our members to feel genuinely in control of their money. 

“We are committed to helping our members in every way we can, which is why we are pledging to help one million people pass Stanford’s financial literacy test. 

“We’re also calling on the Government to go one step further and help address this on a national level, by setting a measurable adult financial literacy target.”

Calling for reinforcements among demand

The company notes that in the first few weeks of the launch of the tools, it saw “record engagement”. More than half of users continued education for two or more days.

Tools also come in the form of 150 lessons to help prepare for unexpected financial emergencies, as well as a suite to help identify where money can be freed up.  

Other tools include a child cost calculator that estimates the cost of having a child for the first year of its life. 

The tools come to meet a demand inspired by the conflict in the Middle East. Stream highlights that weekly spending is on the rise, with a 7% increase since the beginning of the conflict as the prices of essential goods such as fuel and food have seen a sharp increase. 

Stream is also calling on the UK Government to step in in support of a broader goal to increase financial literacy in adults in the UK. 

It says the government should set a national target to improve financial education among not only young people and children but also working-age adults across the nation.