Navigating a path toward a comfortable retirement requires sound knowledge of financial basics and existing investment choices, as well as the ability to understand and cope with the ever-changing set of financial instruments.
A recently released study by the nonpartisan Employee Benefit Research Institute in Washington, D.C., used relatively new data from the National Financial Capability Study, designed by the FINRA Investor Education Foundation, to show the difference in financial literacy and financial behavior across states.
The data show that mostly the same states tend to appear at the top and bottom of financial literacy and financial behavior rankings. What does this suggest? There might be something going on at the state level whereby individual financial literacy and financial behavior are being shaped not only by individual demographic characteristics but also by the state in which people live, EBRI says.
To determine which states, including Washington, D.C., had the lowest financial IQ, AdvisorOne added each states' ranking in Literacy and Behavior and, like golf, the highest scores lost. If a tie occurred on Overall Score, then the state with the worse ranking for Behavior lost the tiebreaker, because not acting is more important than merely not knowing what to do. Herein are the Top 10 Dumbest States for Financial IQ. (A prior slideshow revealed the Top 10 Smartest States for Financial IQ.)
10. TEXAS
Overall Score: 83
Literacy: 39th out of 51
Behavior: 44th out of 51
9. NORTH CAROLINA
Overall Score: 84
Literacy: 48
Behavior: 36
8. ALABAMA
Overall Score: 85
Literacy: 43
Behavior: 42
7. OHIO
(Lost tiebreaker with Alabama)
Overall Score: 85
Literacy: 42
Behavior: 43
6. TENNESSEE
Overall Score: 87
Literacy: 47
Behavior: 40
5. KENTUCKY
4. WEST VIRGINIA
3. LOUISIANA 
2. ARKANSAS
1. MISSISSIPPI
