U.S. Financial Literacy Scores Decline, Generational Divide Emerges

A new study reveals that financial literacy among American adults is slipping, with only half of respondents able to correctly answer fundamental questions about personal finance.

According to research from TIAA-CREF and Standard University, Americans surveyed this year answered just 47% of financial knowledge questions correctly, down from 49% a decade ago. The data highlights a pronounced generational gap: Baby Boomers achieved the highest average score at 54%, while Generation Z recorded the lowest results of any age cohort.

To assess practical understanding, interviewers conducted informal street surveys in New York City, posing a question about household budgeting: “A household budget cannot be used for which of the following?” The correct response—”to track household financial assets”—distinguishes budgeting (managing income and expenses) from asset tracking. Participant answers varied, with some selecting the correct option and others choosing incorrect alternatives. One respondent remarked, “We don’t have financial literacy, but we have money, which is good,” reflecting mixed confidence levels among the public.

Despite the downward national trend, some perspectives offered a more optimistic view. One interviewee with experience living in Australia and England observed that Americans appear more informed about money matters than residents of many other countries—a sentiment echoed in studio discussion noting that financial topics occupy significant attention in U.S. culture.

Financial advisors shared targeted guidance for younger adults. Recommendations included seeking employment at revenue-generating “profit centers” rather than cost-focused roles, and prioritizing careers that support long-term earning potential to sustain a desired standard of living. As one advisor summarized: “As you grow into your earning potential, you earn a comfortable life.”

The findings underscore ongoing challenges in financial education across the United States, as foundational concepts in budgeting, saving, and investing remain elusive for many adults. With economic pressures mounting, experts emphasize that improving money management skills is critical for individuals and households nationwide.