Those Who Have Financial Knowledge Earn an Extra 1.3% Higher Annually

There ain’t no such thing as a free lunch, but by being more knowledge in personal finance principles you will earn more in investment return over the lifetime.  The National Bureau of Economic Research with professors from the University of Pennsylvania, George Washington University, and North Carolina State University, released a study entitled “Financial Knowledge and 401(k) Investment Performance.” The authors found that individuals who had the most financial knowledge — as measured through five questions about personal finance principles — had investment returns that were on average 1.3% higher annually — 9.5% versus 8.2% — than those who had the least financial knowledge. Over a working period of 30 years, the gain would enhance the retirement nest egg of the most knowledgeable by 25%! (cnn.com)