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So Financial Illiteracy is the overwhelming fact that most people don't know and comprehend things like risks, payments over time, the time value of money and other important fundamentals of investing. That is okay. Sometimes simple concepts are actually a lot more complex and challenging to understand. There isn't any education given to people on these concepts. There is a huge amount of emotion added to them, as well, and the appearance that people understand. This is a big part of how Wall Street sells. If people really understood the kinds of deals, costs, and risks out there, well, there would be a lot fewer millionaires (opps, I mean 100 millionaires) from Wall Street.
A great editorial re-printed on the site touches this topic, and NAASA and even FINRA have started to mention it.
This is why we always commend the courage of our clients, to deal with the financial losses. They are courageous to reach out from under this Wall Street myth, that people know more than enough to manage their money, and if it is gone, well, they just didn't do it right, or look for another mention of the perpetual myth of "the market just wasn't with us..."
