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On a scale of 0-100, how financially disciplined would you say you are? How does one even measure such a thing? Forbes Advisor conducted a study to determine which states are the most and least financially disciplined. Here's how the platform did it. (And pseudo-spoiler: The results might surprise you.) 

Forbes Advisor surveyed 5,001 Americans to pinpoint the status of their financial discipline. The survey included eight questions (see full list below) covering the key characteristics of healthy, responsible personal finance, including habits related to saving, spending, budgeting, and retirement accounts. The results were then paired with recently published Federal Reserve data to create a final financial discipline score (on a 100-point scale) for each of the 50 states. 

Here were the results:

The Most Financially Disciplined States

  1. Alabama (83 out of 100)
  2. Arkansas (82 out of 100)
  3. New Jersey (81 out of 100)
  4. Washington (81 out of 100)
  5. Colorado (80 out of 100)
  6. New York (80 out of 100)
  7. Delaware (79 out of 100)
  8. Illinois (78 out of 100)
  9. Nevada (78 out of 100)
  10. Georgia (78 out of 100)

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Key Findings

  • 60% of all survey respondents said they follow a budget for all spending.
  • 41% of all survey respondents said they regularly contribute money to a retirement account. 
  • Male survey respondents (47%) are more likely than female survey respondents (37%) to have a minimum of 3-6 months of expenses saved up for an emergency fund.
  • Millennials (66%) are the generation most likely to pay off their full credit card balance each month.
  • Gen Zers (11%) are the most likely to either make minimum payments or no payment at all on their monthly credit card bill.

What Makes Alabama So Financially Disciplined?

Alabama isn't the wealthiest state in the country, but wealth doesn't equate to financial responsibility. In fact, it's the lack of wealth that might make the Cotton State's residents even more aware of saving and spending behaviors. According to the survey results, 82% of Alabamians always follow their budget and 61% regularly contribute to a retirement account. Alabama's only knocks, according to the survey, come from 62% of respondents admitting to taking out a payday loan in the last three years and 69% saying they make small impulse purchases. 

Taking a step outside of the survey, a good deal of Alabama's financial discipline is likely attributable to its residents' access to financial education. Alabama is one of only 19 states that requires high school students to learn about personal finance extensively through a semester-long career preparedness course. 

Related: Worried You May Be Too Cheap? Here Are the Tell-Tale Signs

Least Financially Disciplined States

  1. Idaho
  2. Hawaii
  3. West Virginia
  4. Montana
  5. Vermont

What's going on in Idaho? Only 30% of the surveyed residents said they have a budget in place — the lowest of all 50 states. The state also has the lowest share of residents (a mere 19%) who said they contribute to a retirement plan. Plus, only about a quarter of surveyed residents (23%) have money saved up for emergency expenses. 

All this could change, though — starting with the 2023-2024 school year, personal finance is becoming part of the curriculum for public high school students in the state. Hooray for financial literacy!

Financial Discipline Survey Questions

Here are the questions Forbes Advisor included in its survey*:

  • Do you have a budget that directs all of your spending?
  • How frequently do you follow your budget?
  • How frequently do you save a certain portion of your income?
  • Which best describes how you manage your credit card balance?
  • Which best describes how you invest your money in a retirement account?
  • Which best describes the financial goals you set for yourself?
  • Have you taken out a payday loan or cash advance in the last three years?
  • Which best describes your habit, if any, in making impulse purchases?

* Choices provided to survey respondents were not included in the report.

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