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updated 4/13/2010 7:34:20 PM ET 2010-04-13T23:34:20

Americans would make smarter investment choices if they sharpen their financial know-how, Federal Reserve Chairman Ben Bernanke said Tuesday.

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During the housing boom, for instance, some took out mortgages that they didn't understand or couldn't afford. When the market went bust, foreclosures skyrocketed.

"Many American families are struggling in the aftermath of the financial crisis, which reinforces the need for reliable and useful information to facilitate good financial choices," Bernanke said in prepared remarks to a summit here on financial literacy.

"Helping people better understand how to borrow and save wisely and how to build personal wealth is one of the best things we can do to improve the well-being of families and communities," he added.

The Fed provides, among other things, an online credit-card calculator to help people estimate how long it will take to pay off a credit card bill under different payment scenarios. It also provides information on how to avoid mortgage scams and how to protect checking accounts.

Still, the Fed has been blasted by lawmakers and others for failing to protect consumers early on from dubious mortgage practices that contributed to the housing implosion. It also has been chided for not taking other steps to better protect consumers when it comes to financial products.

Bernanke has acknowledged the Fed's shortcomings in the past and on Tuesday he reiterated that the Fed is strengthening its consumer-protection oversight.

A House-passed bill revamping the nation's financial regulatory structure would strip the Fed of its consumer-protection duties and create a new agency devoted to these matter.

A Senate version of the bill, though, would place an independent consumer watchdog inside the Fed. This consumer financial protection unit, though, would have its own director appointed by the president. It would not fall under Bernanke's authority.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Home equity type Today +/- Chart
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