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Even though The latest financial literacy statistics show that just over half, or 57% of American adults, are financially literate, that percentage actually places the USA among the most financially literate countries in the world. The data reveals that there is a dire need for financial education almost anywhere in the world, especially for young people.
From relying on financial advice from influencers, to being unable to distinguish the difference between credit and debit cards, the lack of basic financial knowledge is evident. The article below has the most recent stats you need to understand the poor state of financial literacy in the United States.
Top 10 Financial Literacy Statistics and Facts
Less than a half, or 44% of American adults, say they can pay an unexpected $1,000 expense from their savings.
The average American answered 50% of the questions correctly in a 2022 financial literacy test.
Americans lost an average of $1,389 due to financial illiteracy in 2021.
Only 30% of Americans say they have paid for financial advisor services before.
60% of Americans who paid for the services of a financial advisor say they hired them after a specific life event.
25% of US adults say they have looked for financial advice on financial websites.
31% of US adults say they have never asked anyone for any financial guidance.
49% of Americans say that inflation is causing them to save less.
74% of teenagers say that they don’t feel confident in their knowledge of personal finance.
32% of US teens can’t tell the difference between a credit and a debit card.
Youth Financial Literacy Statistics
74% of teenagers say that they don’t feel confident in their personal finance knowledge.
In addition, 73% of them say they want to learn more, but 15% are not sure where to start. When it comes to what they do know about, 62% of teens say they learned about saving, 50% learned about earning, and 44% learned how to save for college. Moreover, 42% of teenagers say they learned about budgets, but 23% of them say they don’t know how to make one.
(Green Light)
32% of US teens can’t tell the difference between a credit and a debit card.
Moreover, teenage financial literacy statistics show that 41% of teenagers don’t know if they have to pay taxes, 46% can’t define a 401(k) plan, and 81% have no idea what an EFT is. While they rank it as the least reliable source of information, 48% of teens still use social media to learn about investing. The most commonly used social media platforms are YouTube, with 38%, Tik Tok, with 33%, and Instagram, with 25% of teens looking for personal finance and investing advice on those channels.
(PR News Wire)
75% of teens say that they are learning about personal finance from their families.
While parents are the number source of financial knowledge for teens, youth financial literacy statistics reveal that 86% of them say they are interested in investing, but 45% haven’t invested yet because they are not confident or their parents don’t know how to get started. Other sources of financial literacy for teens are schools, where 52% of teenagers get their knowledge from, and social media, where 42% of them say they learned about personal finance.
(Green Light)
33% of teenage boys, vs 21% of teenage girls, say they are confident in their personal finance knowledge.
Another interesting comparison that reveals the gender difference is that 42% of teenage girls want to learn about donating and giving, while only 29% of the boys are interested in this. Conversely, according to the statistics of learning financial literacy when young, 41% of teenage boys want to learn about investing in stocks, while only 30% say that this is something they want to learn about. Where they are somewhat more similar is that the lack of confidence stops them from starting to invest, with 46% of the girls and 37% of the boys citing this as their main reason.
(PR News Wire)
Statistics on Hiring Financial Advisors
Only 30% of Americans say they have paid for financial advisor services before.
Financial advisors should only be hired by wealthy people, according to 42% of the US adult population. Interestingly, facts about financial literacy show that this opinion is shared dominantly by women, 48% of who believe in it, as opposed to 35% of men who think the above statement is true. In addition, 50% of US consumers don’t know the actual cost of financial guidance services, but they believe it costs a lot more than it actually is.
(Napa-Net)
95% of the people who hired financial advisors believe that they are worth the money.
According to the results of a recent survey, 61% of the US adults who pay for the services of a financial advisor say it doesn’t cost them more than $3,000 per year. Moreover, financial literacy stats show that the most common reason for hiring a financial advisor is investment management, cited by 60% of the respondents.
Other popular reasons Americans hire financial advisors include achieving certain financial goals, cited by 38%, getting general financial advice by 36%, and creating a complete financial plan, cited by 30% of the respondents.
(Napa-Net)
60% of the Americans who paid for the services of a financial advisor say they hired them after a specific life event.
According to financial literacy statistics in America, 14% of them say they hired a financial advisor after getting married or divorced, while 11% did it after receiving an inheritance or a similar way of receiving a large sum of money. In addition, another 12% of Americans say they hired a financial advisor when they reached retirement age.
(Napa-Net)
57% of people who have never used financial advisor services say they are better off managing their money themselves.
Additionally, 33% say they have never hired financial advisors because they are too expensive, while 25% believe they don’t have enough assets invested to require their help. However, statistics on financial literacy reveal that 78% are open to hiring a financial advisor in the future. Finally, 28% of Americans say they would hire an advisor if they start earning more than $100,000, while 24% would do so if they receive a large inheritance. Finally, 23% of them say they would seek professional financial advice if they had more than $500,000 worth of investable assets.
(Napa-Net)
55% of US consumers with incomes higher than $100,000 have paid for financial advisor services.
According to the statistics about financial literacy, consumers who earn more than $100,000 are most likely to hire financial advisors out of any group, sorted by income. By education level, college graduates are most likely to pay for financial advice services, with 41%.
By generation, 36% of Baby Boomers, 31% of Millennials, 29% of Gen Zers, and 24% of Gen Xers say they have hired a financial advisor before. Finally, men are more likely to pay for financial advice with 35% vs 25% of women who have hired financial advisors.
(Napa-Net)
46% of Gen Zers said they hired a financial advisor to help them with their tax planning.
Young adults financial literacy stats reveal that the younger generations in the US need more help with their taxes than the older ones. In addition to Gen Zers, 34% of Millennials say they also hired financial advisors to help them with tax planning. Gen Xers, on the other hand, are not that likely to hire advisors for this reason, with only 24%. The percentage drops even more for Baby Boomers, as only 10% say they hired financial advisors to help them with their tax planning.
(Napa-Net)
Financial Literacy Demographics
25% of US adults say they have looked for financial advice on finance websites.
According to statistics on financial literacy in the US, Millennials are the most likely to seek financial advice on the internet, with 30%, followed by Gen Xers, 27% of whom say they have looked for financial answers online. Furthermore, 25% of Gen Zers report they have looked for financial guidance on the web, while Baby Boomers are the least likely generation to look for financial advice on such websites, with a share of only 19%.
(Credit Cards)
37% of adult Americans say they have asked their family or friends for financial advice.
Gen Z financial literacy statistics reveal that the youngest generation of US adults is the most likely to rely on friends and family for financial guidance, as 53% of the surveyed American Gen Zers say they have done so in the past. After them, Millennials are the second-most likely generation to do so, with 44% of them saying they have done it.
In addition, the stats show that 37% of Gen Xers have confided in their closest ones with financial troubles, while only 25% of Baby Boomers have asked their family and friends for financial advice.
(Credit Cards)
31% of US adults say they have never asked anyone for any financial guidance.
Financial literacy facts show that Baby Boomers are the generation that is the most likely to never seek financial advice from anyone else, with 39% of them saying they only rely on themselves with financial questions. Moreover, 36% of Gen Xers say that the above applies to them, while younger generations are significantly less likely to rely on themselves with financial troubles. Namely, only 23% of Millennials and 22% of Gen Zers say they never asked anyone for financial advice.
(Credit Cards)
49% of Americans say that inflation is causing them to save less.
Facts about the lack of financial literacy for the youth show that this is especially true for Millennials and Gen Xers, 54% and 53% of which agree with the above statement. In comparison, only 36% of Gen Zers say they save less because of inflation. In addition to them, there are also 16% of Americans who say that inflation is causing them to save more rather than less, while 33% say that inflation has no impact on their saving.
(Bankrate)
14% of Americans say they have sought financial advice on social media or from influencers.
In addition, an equal percentage of people say they have looked for financial guidance in newspapers or magazines, 13% in books, and another 13% on the radio, TV, or podcasts. The statistics on why financial literacy should be taught in school reveal that Gen Zers will most likely seek financial advice on social media, as 28% of them have reported doing so. Moreover, 24% of Millennials, 10% of Gen Xers, and just 4% of Baby Boomers have turned to social media for financial guidance.
(Credit Cards)
Friends and family are the go-to sources of financial counsel for 45% of US households who earn more than $80,000 per year.
Besides relying on their closest ones, high-earning American families also seek financial advice from financial advisors, with 39% of them saying they have done so. In comparison, financial literacy facts and figures show that low-earning families in the US, or those who earn up to $40,000 annually, also seek advice from friends and family, with 32% of them saying this applies to them.
However, they are significantly less likely to look for financial advice from financial advisors than the high-earners, as only 12% of them say that they have done this. Lastly, 42% of low-income families say they never looked for financial advice from anyone else, while only 14% of the households with a yearly income of over $80,000 rely solely on themselves regarding financial questions.
(Credit Cards)
General Financial Literacy Statistics
The average American answered 50% of the questions correctly in a 2022 financial literacy test.
The Personal Finance Index is an annual survey conducted by the TIAA Institute and GFLEC that measures the financial literacy of US consumers. Since 2017, the average number of correctly answered questions varied between 49% and 52%.
In 2022, only 18% of respondents have answered between 22 and 28 questions correctly, while most of them, or 33%, had the correct answers for between 15 and 21 questions. Furthermore, financial literacy statistics of 2022 show that 26% answered between eight and 14 questions correctly, and finally, 23% gave the correct answers to between zero and seven questions.
(TIAA Institute)
Only one-third, or exactly 33.4%, of surveyed Americans say they turn to financial professionals when they have a financial question.
A recent survey reveals that most Americans, or 40.8%, depend on their parents, family, friends, or coworkers when it comes to getting financial guidance. However, it also shows that a whole 25.8% of US consumers say that they have nobody they can trust with their financial questions. Statistics about financial literacy suggest that not much has changed in this regard since 2020. The results from that year show that 39.7% of the adults in the USA relied on friends and family, 35.9% on financial professionals, and 24.4% solely relied on themselves for financial advice.
(NFEC)
70% of US adults consider financial advisors a trustworthy source for financial guidance.
Even though financial advisors are cited as a trustworthy source of financial counsel by the largest percentage of Americans, there are still 16% who don’t consider them as such. In addition, fun facts about financial literacy reveal that 69% of them view financial institutions as a source you can trust, while 20% say they are not trustworthy.
Moreover, 64% of US adults believe friends and family are reliable sources of financial guidance while only 24% disagree. Finally, 57% of Americans trust books, while 26% believe they are unreliable, and social media is viewed as a trustworthy source of financial wisdom by only 21%, while 65% believe the opposite.
(Credit Cards)
Less than a half, or 44%, of American adults say they can pay an unexpected $1,000 expense from their savings.
Financial wellness statistics suggest that less than half of the US adult population has enough savings to cover a $1,000 surprise expense without making any modifications to their budgets. 20% of Americans say they would put the expense on their credit card and pay it off over time, while 15% say they would cover it with money in their pocket, but would have to cut other expenses. Furthermore, 10% say they would borrow the money from their friends or family, and 4% would have to take a personal loan to cover the expense.
(Bankrate)
Americans lost an average of $1,389 due to financial illiteracy in 2021.
A recent survey on the lack of financial literacy asked Americans how much they believe they lose due to a lack of financial knowledge, and the most commonly given answer was between $0 and $499, provided by 63% of the respondents. However, 10.6% of them believed they lost between $500 and $999, while 8.5% thought they lost between $1,000 and $2,499 due to financial illiteracy.
Probably the most shocking answers were given by the 7.2% who believed they lost between $2,500 and $9,999 and the 10.7% who said they lost more than $10,000 due to their lack of financial knowledge. According to the financial literacy statistics based on their answers, the typical American loses $1,389 on average per year, or a total of $352 billion of a proverbial financial loss is suffered among the 254 million US adults annually.
(NFEC)
American consumers lost over $5.8 billion to fraud in 2021.
The above figure translates to a 70%+ increase compared to the money US consumers lost to fraud the year before. The number of consumers who filed reports to the FTC was close to 2.8 million, which is the highest number since 2001. However, not all cases are reported to the agency, so the actual number is possibly even higher than that. About 25% of these incidents resulted in a financial loss, with the average victim losing $500.
(CNBC)
Financial Literacy in the US Test Statistics
US consumers answered 60% of the borrowing questions correctly.
According to the test results, the average American is most familiar with borrowing, as this is the area with the largest percentage of correct answers, followed by saving, where 58% of the questions were answered correctly. Moreover, 52% of the answers in the consuming, 49% in the go-to info sources, and 48% in the earning categories were correct.
Furthermore, Americans answered 47% of the investing and 45% of the insuring questions correctly. Financial illiteracy statistics reveal that the weakest area of the US consumer’s financial knowledge is comprehending risk, as only 36% of the questions in this category were answered correctly.
(TIAA Institute)
The average Baby Boomer and Silent Generation Americans answered 54% of the questions correctly.
With age comes wisdom, and this saying proves correct regarding financial literacy. The test results reveal that older generations tend to be more financially literate, and the number of correctly answered questions notably decreased as the surveyors got younger.
Namely, the average Gen Xer got 51% of the questions right, while Millennials got an average of 46% correct answers. The test also proves the lack of financial literacy among Gen Zers, who had the lowest average of only 42% of correct answers.
(TIAA Institute)
With 24% of them answering between 22 and 28 questions correctly, Asians had the best test results.
In addition, another 34% of the surveyed Asians answered between 15 and 21 of the questions correctly, resulting in 58% of them having correct answers to more than half of the questions. 60% of White Americans answered 50% of the questions correctly. 23% had the correct answer for between 15 and 21, and 37% for between 22 and 28 questions. One of the most unfortunate financial literacy facts in the black community is that only 28% of the surveyed Black Americans answered more than half of the questions correctly. The share of Hispanics who did the same was 30%.
(TIAA Institute)
On average, Men answered 55%, and women answered 45% of the questions correctly.
The data from the test results further reveals that respondents with college degrees had the largest percentage of correct answers, at 65%. In comparison, Americans who went to college but never got a degree answered 49% of questions correctly, those with a high school education got 38% right, and people without high school education only answered 31% of the questions correctly.
Lastly, the stats on lack of financial literacy show a notable difference between respondents who received financial education and those who didn’t, as the former group gave correct answers to 60%, while the latter only to 46% of the questions.
(TIAA Institute)
FAQs on Financial Literacy
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Conclusion
The numbers speak for themselves. The US population might be one of the most financially literate in the world, though the latest trends show worrying signs of illiteracy among young people. Luckily, as of 2021, 25 states introduced legislation that aims to add personal finance education to high school curriculums, and other states are looking to follow suit. It is good that schools understood the importance of financial literacy for the American youth and quickly reacted to rectify the situation before it got out of hand.
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