Numeracy vs. genuine financial literacy

Foundations: Two Kinds of Numeracy
There are two very different things people mean when they say “numeracy,” and financial literacy programs almost never distinguish between them.

Merriam-Webster (2023) defines numeracy as the ability to interpret and use numbers effectively for managing finances. That’s the version most curricula teach: calculate the interest rate, balance the checkbook, build the monthly budget.

Gal and Tout (2014) define it very differently. Genuine numeracy, in their framing, is critical engagement with quantitative information, the ability to interpret the terms of a financial product, interrogate the assumptions buried in a budget proposal, and evaluate the claims institutions make about you. Tout (1997) goes further, arguing that “critical numeracy” is actually redundant, real numeracy already includes critical thinking, full stop.

Most financial literacy programs teach the first definition and call it the second. That’s not a small gap. Someone can calculate a payment plan perfectly and still have no ability to interrogate whether that payment plan is a fair one, or whether the institution offering it is telling them the truth.

This is exactly why our program treats numeracy as inseparable from advocacy. We don’t just teach someone to read a lease. We teach them to question a lease.

I go deeper into this distinction in this week’s episode.

If you work in adult education, which version of numeracy does your curriculum actually teach, the calculation version or the critical one?

Author: Sandra Roussel
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