The Looming Disaster for New Grads
The state of financial education in America is awful...
The TIAA Institute-GFLEC Personal Finance Index measures financial literacy. One measurement in the index includes a 28-question survey that covers eight basic areas of financial knowledge. In the 2024 survey, the average person answered 48% of the questions correctly. That's down from 50% in 2017. And Gen Z adults ranked the worst – correctly answering only 37%.
This lack of financial literacy is why lenders often prey on college students with aggressive marketing techniques that haven't improved much since the CARD Act in 2009. According to a 2019 report from education company Everfi, 36% of college students have at least $1,000 in credit-card debt (not to mention the tens of thousands of dollars in debt thanks to student loans).
The problem has been going on for generations.
So we want to hear from you...
What do you wish you'd known about finance and investing when you were younger? What's the best piece of advice you would give to a young person graduating or someone starting on their wealth journey?
For our younger readers, what financial questions do you have that you're too embarrassed to ask?
Send all of your stories, suggestions, and questions to feedback@healthandwealthbulletin.com.
Here's to our health, wealth, and a great retirement,
Dr. David Eifrig and the Health & Wealth Bulletin Research Team
May 10, 2025
Reader question of the week...
Q: Doc, you always talk about insurance tips for people. What about pet insurance? Every time I take my dogs to the vet, they always ask about/recommend pet insurance. – E.K.
A: Pets are expensive... According to the ASPCA, the average yearly routine medical cost – including preventive medication – is $300 for a cat and $410 for a dog.
And if you have an emergency, it could cost $1,000 just to get a diagnosis, while hospitalization or emergency surgery can run in the multiple thousands of dollars. Many pet owners can't afford that... According to a 2024 survey from Forbes Advisor, more than 25% of Americans have less than $1,000 in a savings account.
Pet insurance companies want to capitalize on that. The North American Pet Health Insurance Association reported that gross premiums rose a whopping 200% from 2019 ($1.56 billion) to 2024 ($4.7 billion).
But here's the problem: The average pet insurance plan, covering accidents and illness, will cost you around $276 for a cat and $552 for a dog each year... And this varies widely depending on the age and breed of your pet and the insurance company's policies. Coverage also comes with a lot of caveats...
- Plan deductibles can be an additional $250 to $750.
- Most plans don't cover preexisting conditions.
- Many plans also exclude coverage for congenital conditions, cancer treatments, or other conditions requiring long-term treatment.
- You (usually) pay for treatment up front, then seek reimbursement.
Here's a better plan for your money...
Take the money you would have put toward a monthly insurance premium and set up a savings account designated for emergency pet care. That way, if you need it, the money's there... And if you don't need it, you won't lose it. You can even grow your emergency fund by choosing a savings account with no fees, no minimum requirement, and a reasonable annual percentage yield ("APY").
A high-yield savings account is often your best bet for a higher interest rate. Right now, banks are offering up to 4.4% APY for high-yield savings accounts. Many banks don't even require a minimum balance.
If you're thinking about adopting a new pet, start this savings fund right away. Aside from upfront costs (like spaying/neutering, vaccines, and essential supplies), the cost of pet ownership typically rises as pets age due to increased medical costs. Opening a high-yield savings account is a simple way to manage your pet's care by creating your own insurance instead of padding some large corporation's pockets.
Keep sending your questions, comments, and suggestions our way. We read every e-mail... feedback@healthandwealthbulletin.com.
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