economy
Americans' Financial Literacy Slumps to a 10-Year Low, New Study Finds
Americans' understanding of basic financial concepts has fallen to a 10-year low, raising concerns that households are becoming less prepared to manage debt, savings and retirement decisions, according to a new study from investment giant TIAA and Stanford University's Global Financial Literacy Excellence Center.
TL;DR
- American adults correctly answered 47% of financial literacy questions in 2025, the lowest score in a decade.
- The percentage of Americans with very low financial literacy has increased to 25% from 20% a decade ago.
- Low financial literacy is associated with higher debt levels and greater difficulty making ends meet.
- Women and younger adults (Gen Z) scored lower than men and older generations.
- Potential reasons for the decline include misleading social media financial information, weaker overall literacy, and financial pressures on households.
- Some economists argue that the complexity of the financial system, rather than solely consumer knowledge, is a significant factor.
- Specific questions from the TIAA financial literacy test and the percentage of correct answers are provided.