Financial Literacy Statistics in the US (2025): What the Data Says

Financial literacy is often talked about as a “nice-to-have,” and half of us don’t even know what that is. But the numbers tell a different story. Research from 2024 shows that over 50% of Americans struggle with basic money knowledge (World Economic Forum, 2024). These gaps affect everything from debt levels to retirement planning and even everyday stress. Let’s break down the most recent data, explain what the scores mean, and show how tools like Pine AI can help you take action instead of feeling overwhelmed.

How financially literate are U.S. adults right now?

Financial literacy in the United States has remained stubbornly low. In fact, most major research institutions that we looked at report that the typical U.S. adult correctly answers about half of the questions they are asked about everyday money decisions.

The 2025 TIAA Institute (Teachers Insurance and Annuity Association of America)–GFLEC Personal Finance Index (P-Fin Index) is one of the most widely used measures, and it found that U.S. adults answered only 49% of basic personal finance questions correctly (TIAA Institute–GFLEC, 2025). For your information, the GFLEC measures knowledge and understanding that enable sound financial decision making. This is in line with trends from earlier years, and showing no major improvement.

The World Economic Forum (WEF, 2024) also noted that U.S. money knowledge has hovered near the same level for close to a decade, with slight declines in recent years as financial products become more complex.

According to a WalletHub survey (WalletHub, 2025), nearly 47% of Americans rate their own financial skills as a C grade or lower, a jump of more than 10 percentage points from previous years.

Across the board — from FINRA Foundation research to national surveys by the National Financial Educators Council (NFEC) — the conclusion is clear: financial literacy in the U.S. is low, persistent, and not improving fast enough.

Key Financial Literacy Statistics in the US (At a Glance)

Here is a quick snapshot of the most frequently cited numbers.

These numbers paint a picture of a nation where people want financial stability but more than half don’t have the knowledge to navigate today’s fast-moving financial landscape.

What Is Financial Literacy? (Definition Used in These Statistics)

Financial literacy just means understanding how money works so you can make smart choices about spending, saving, and investing it. So it's not about macro economics, or how to invest your money. Researchers measure it simply through everyday decisions.

A Working Definition for Everyday Americans

For this article, we use a widely accepted definition consistent with the Global Financial Literacy Excellence Center (GFLEC):

Financial literacy is the ability to understand and use financial knowledge to make informed decisions about earning, spending, saving, borrowing, and investing.

It’s a combination of understanding concepts and applying them in real life, like choosing between paying off debt or saving, deciding how much insurance to buy, or evaluating the long-term cost of a loan.

How Researchers Actually Measure It

Most national studies rely on the Personal Finance Index (P-Fin Index), which assesses:

• Earning
• Spending
• Saving
• Investing
• Borrowing
• Insuring
• Understanding risk
• Comprehending everyday financial products

The P-Fin Index includes 28 questions across these eight areas. It is considered one of the most comprehensive and reliable measurements because it tests both understanding and real-world decision-making (GFLEC, 2025).

How Pine AI can help with financial literacy

Financial literacy isn’t only about learning — it’s also about taking meaningful action. That’s where automation and Pine comes in.

“Financial literacy stats are a warning sign: money is stressful and confusing for a lot of people. Pine AI turns that stress into simple actions, like cancelling what you don’t use and reducing everyday costs, so progress feels possible.” – Stanley Wei, CEO of Pine

For many people, the issue isn’t just lack of knowledge — it's the emotional burden of decision overload. Bills renew automatically, fees hide in fine print, and subscription services stack up without people noticing. Pine AI helps users:

• Identify unnecessary recurring costs
• Cancel unused subscriptions
• Reduce everyday bills
• Free up cash flow without lifestyle sacrifice

This gives people “breathing room” — which is one of the biggest barriers to improving money literacy in the first place.

Financial Literacy Statistics by Age Group (Gen Z to Boomers)

Generational differences in financial literacy are some of the largest gaps reported in national surveys.

Gen Z and Young Adults

Gen Z scores significantly lower than all other age groups. Finance is an area of struggle for many Gen Zers, with 46% unable to understand cryptocurrency, 33% unsure about inflation and interest rates, and 8% unable to identify the number of cents in a dollar. (EduBirdie, 2025). It’s almost as if they believe TikTok and Memes will get them through life.

This gap is influenced by:

• Increasing student loan complexity. It used to be borrow this much at this percent for this many years and here’s your monthly payment starting at graduation. Now, the rates vary and change and the term can also.
• The explosive growth of “buy now, pay later” financing. This is a short term loan to buy something and is the alternative to credit cards for young people without a credit history. This can really get away from you.
• Social media pressure to spend. Platforms like Facebook and TikTok listen to what you talk about and coordinate their ads to suit your desires.
• A lack of hands-on financial education in high school. Financial Educators Council states this is a huge failure on the part of the educational system. (FEC, 2025)

Most Gen Z adults manage money through dozens of apps, services, BNPL providers, and digital banks — making financial decisions feel more fragmented than ever. No one balances a checkbook anymore.

Millennials and Gen X

Millennials and Gen X tend to score slightly higher, but still face major gaps. According to the TIAA Institute–GFLEC (2025):

• Many struggle with risk and long-term planning. Saving money is almost beyond their reach.
• Retirement and investing knowledge is often below average. More and more, young people can’t imagine ever being old enough to retire, so unless they get a job that forces them to invest, has a pension or puts money into retirement for you, these folks may never be able to retire.
• Mortgage complexity and family expenses add financial stress. Home prices have gone up, mortgage rates fluctuate so often, we never know if it’s time to refinance or get a home equity line of credit to pay down other debt. Cost of private education is skyrocketing and if you happen to have a child with extracurricular sports or activities, those cost now too.

Despite higher household incomes than Gen Z, many mid-career adults feel behind on savings or are in debt, given the rising cost of housing, healthcare, and childcare.

Boomers and Older Adults

Boomers and older adults score the highest among the generations, averaging around 55% on financial knowledge assessments (TIAA Institute–GFLEC, 2025). However, even this group leaves nearly half of questions unanswered.

Areas where older adults commonly struggle:

• Long-term care planning. Many older adults are living with their children, relying on them for long term care.
• Understanding investment risk and taxes as they pull from their retirement, collect social security and are trying to figure out how to make it last.
• Navigating required minimum distributions. The only real way to do this correctly is to have a financial planner, so now they are paying someone else to figure it out for them.
• Inflation-adjusted retirement income needs. Most thought, or hoped, the cost of living would stay the same after they started living off their retirement. That’s not the case as it keeps going up, causing fear they won’t have enough.

While Boomers are currently the most financially literate generation, they still face challenges preparing for longer lifespans, higher cost of living and rising medical costs.

Financial Literacy Gaps by Gender and Race

Not all groups score the same on financial literacy assessments and certain gaps have remained consistent for years.

The Gender Gap in Financial Literacy

The P-Fin Index shows that women, on average, score 10 percentage points lower than men on financial literacy assessments (TIIA, 2025).

But researchers point out something interesting:

• A major factor contributing to the gap is a difference in confidence. Women are more likely than men to use the "I don't know" option when answering questions (25% for women vs. 20% for men in 2020), even when controlling for actual knowledge levels.
• Men often overestimate theirs. Overconfidence can often lead to excessive risk taking with trading and investments.
• Women face greater long-term financial risk due to wage gaps, career breaks, and longer life expectancy. They make less, are promoted less and live longer.

Racial and Ethnic Disparities

Black and Latino adults both score below the national average but are fairly equal to each other, according to TIAA Institute–GFLEC (2025).

Factors contributing to this include:

• Unequal access to high-quality K–12 financial education or any education at all, for some. Most are in public schools with 40+ per classroom and little to no individual attention from overworked and underpaid teachers.
• Income disparities. Racism is still an issue in many industries, especially those with high earning potential. This makes it challenging for those of color to get these positions, even when they are qualified.
• Predatory financial products disproportionately affect racial and ethnic minorities, particularly Black and Latino communities, due to a combination of discrimination, systemic barriers to mainstream banking, and targeted marketing.
• People of color generally have less benefits and retirement savings again due to systemic and historical factors that lead to lower lifetime earnings, less access to employer-sponsored retirement plans, and lower overall wealth. These result in a less secure retirement, with a higher reliance on Social Security, even though their benefits are lower due to lower lifetime earnings.

These differences highlight why many organizations advocate for earlier and more inclusive financial education.

Financial Literacy by State (Most and Least Financially Literate)

The level of financial literacy varies widely across the U.S., influenced by policy, education, income, and local economic conditions.

How States Are Ranked

WalletHub’s 2025 financial literacy study ranks states using “17 key metrics,” including financial education in public schools, share of adults with emergency savings, credit scores, debt levels and retirement savings participation. These key metrics create a holistic picture of which states are better at equipping residents for financial success.

Here are the top and bottom 5 states:

Who’d have thought Minnesota would be #1?

Patterns Across the Map

The findings also reveal clear patterns:

• States where financial education is required in high school and where a large percentage go on to receive a higher education degree tend to score higher. Also note, states where just a fractional percentage don’t have bank accounts score higher as well.
• States where people have high financial burdens due to home and living expenses and weaker or no financial education generally score near the bottom.
• Rural states with lower cost of living often have stronger saving habits moving them closer to the top of the chart.
• Urban coastal states show larger debt burdens despite higher incomes, giving them an overall lower score.

How Low Financial Literacy Shows Up in Everyday Life

Financial illiteracy isn’t an abstract. It has real and immediate consequences. If you don’t know, or worse, you don’t know that you don't know, it makes keeping your finances in order almost impossible.

Struggling to Make Ends Meet

The FINRA Foundation’s National Financial Capability Study (2024) reveals an overall pattern of decline in the ability of U.S. adults to make ends meet and save for emergencies. While income remained steady, the impact of increased costs has put more households under financial strain than in years past.

This study has been conducted every three years since 2009, and between inflation, rising costs, little to no savings and managing money on an app, regular Americans are losing it, both money and sanity.

Emergency Savings and Debt

A large share of Americans do not have even one month of emergency savings. The average amount financial illiteracy cost in 2024 was $1015 per American, because they can’t afford to save or don’t know how to. (Financial Educators Council, 2024) Research shows:

• People with low financial literacy are more likely to rely on high-cost credit. Everyone gets a 24.9% credit offer daily, and if you don’t know any better, you’ll take it.
• Low literacy is linked to higher debt stress. Once you take that credit card at 24.99%, you use it, probably to survive, and then you owe a ridiculously higher amount you’ll never get out from under.
• Many households feel trapped in a cycle of interest payments. Mortgages are the worst. Generally, 90% or more of your payment is interest. Most just assume they will be paying for the house until they sell it or die. It’s tough. Credit cards are no better. Your minimum payment basically covers the interest if the card is close to max.

The TIAA Institute–GFLEC (2025) emphasizes that understanding basic interest, both on savings and debt, has one of the strongest correlations with healthier financial outcomes. Do you understand what APR means? Do you comprehend how interest is charged on your mortgage, loans and credit cards? If you don’t, stop, research and decide it’s time to change. Most of us sign up and then just suffer.

Retirement Readiness and Longevity Risk

People don’t understand retirement planning anymore. This is especially true if you were born after the baby boomers, the only ones who still have retirement. People are not planning on long life spans and have inadequate savings. (TIAA Institute–GFLEC, 2025).

This contributes to:

• Underfunded retirement accounts. You usually get a choice when you are offered a job. How much do you want to put into retirement? Take a close look at your life and put in the maximum you can. It pays off in the end.
• Overreliance on Social Security, which is almost funny. There are so many rumors or sadly, political speeches, that talk of Social Security going away. Poof! No more. So sorry you paid into it for years, but now you get nothing. Plan a better way. Let Social Security be your vacation bonus.
• Difficulty planning for healthcare and long-term care. There is a moment in everyone’s life where you think you’ll live forever as a healthy active human. Then you turn 50 and things start to hurt and you have to go to the doctor more. Life, right?
• Fear of outliving savings. It’s not so much a fear as it is a reality. We are living longer, for the most part, and with cost of living increasing, we don’t have the financial time we thought we had.

Retirement literacy is one of the most concerning areas, given increasing life expectancy and rising costs. The young don’t think about this. The old worry about it. Education in financial literacy or understanding is invaluable today for every individual, no matter the age.

What We Are Searching For (in regards to Financial Literacy)

Current search trends offer a real-time snapshot of what people are struggling with most, especially as higher interest rates make everyday finances more challenging. Right now, the biggest concerns center on budgeting and paying down debt.

How to budget

People want simple, realistic ways to understand where their money is going without feeling overwhelmed. There is a balance between balancing an actual checkbook, online banking and the twenty or so apps you have managing your money that are not connected.

Things you can use:

• 50/30/20 Budget Template - available for free from consumer.gov
• Free budgeting apps: Mint, YNAB and Goodbudget
• Alternatively use Pine to do the heavy lifting for you and help things like negotiating on lowering your bills

How to pay off credit cards

Rising interest rates mean credit card balances grow faster, and people are searching for clear, step-by-step ways to get ahead. If your credit is good, apply for 0% interest cards and transfer your balances to it until you can pay down or you get offered another 0% interest card. Transfer again. It’s a game with the credit card companies, but one you can win if you pay attention.

Debt snowball vs avalanche

The avalanche method focuses on paying off debts with the highest interest rates first, which can save money on interest over time. The snowball method targets the smallest debts first, helping build momentum and motivation with early wins. Choosing the best approach depends on your financial situation and personal preferences, as each method offers different benefits, such as interest savings or psychological encouragement.

What This Tells Us

People are craving clear, actionable, and judgment-free guidance. They want financial tools that are simple, encouraging, and easy to implement during uncertain times. Pine AI might just be your answer. We will get this all figured out for you.

“Most people are overwhelmed by the choice in financial decision making. They need breathing room. Pine AI helps you spot waste in bills and subscriptions, so you can free up cash and get more time back to understand the bigger picture. We can get you started towards saving and understanding.” – Stanley Wei, CEO of Pine

Credit Scores, BNPL, and Digital Money

Gen Z is entering adulthood with more digital tools than any previous generation. While these apps make spending easy, they also create confusion around long-term planning—leading to frequent searches about credit and financial safety.

Credit score tips

Gen Z wants to understand how credit scores work and how to strengthen them early to qualify for apartments, car loans, and low-interest credit, but usually doesn’t have the time for it. And they are internet savvy and searching for the next best every day.

Buy now pay later risks

With BNPL apps becoming a go-to payment method, young adults are searching for the potential downsides such as late fees, overspending, and how multiple payment plans can strain a budget.

How to build credit from scratch

Many Gen Z consumers have little to no credit history, so they're looking for simple ways to get started—such as secured cards, rent reporting, or becoming an authorized user on a parent or other account.

Emergency Funds, Side Hustles, and Inflation

Inflation has made building and maintaining an emergency fund more challenging, as rising costs squeeze household budgets. Most can’t even compute having an emergency savings these days. Side hustles have become a vital strategy for many to generate additional income to build or boost their emergency savings and mitigate the impact of inflation.

So, what’s a side hustle? Side hustles are a practical way to generate extra cash flow to counter inflationary pressures and accelerate the growth of your savings, helping individuals reach their savings goals faster without cutting into their primary budget. In basic terms, a second job.

How to Improve Financial Literacy (Practical Steps Backed by Research)

Financial literacy isn’t only about scoring higher on a test — it’s about building everyday habits that help YOU get out of debt, create a savings or retirement and have a positive financial future.

Start With Simple, High-Impact Skills

Researchers consistently find that the three most impactful skills are:

1. Building an emergency fund (Even if it’s that big glass jar you throw all your coins and $1 bills in).
2. Understanding interest (especially on debt). This is a tough one. You get a credit card offer at a cert APR. Half the time we’re just excited to be approved. You’ve got to understand what you are paying for that credit.
3. Tracking income, expenses, and net worth. Budgeting 101. Start with a notepad and work your way up to a software platform attached to your bank account. But, budget. Period.

Use Trusted Resources and Tools

Easy one. We’ve offered several already. But do your research.

Make Learning Continuous, Not One-Off

A single personal finance class rarely sticks. Instead:

• Use micro-lessons. Join webinars or LinkedIn classes that you can watch when you have time. BUT, you need to schedule time for them, attend and take notes.
• Set small goals. You’re not going to figure this out overnight. Plan on paying off one credit card or paying down 3. Your credit score goes way up as soon as all your cards are at the 30% or less use base. Try for no interest cards and transfer balances. The important thing is, stay on top of it.
• Automate savings where possible. Many bills give you discounts if you pay quarterly or annually, in advance. Check with your providers, or have us do it.
• Review spending regularly. Don’t just jump on your bank app and see what you have left to spend. Check what is going out regularly. I had a simple $9.99 charge from an unknown internet link that I finally noticed I’d been charged for over two years - every month. Watch your money.
• Use apps or AI tools to stay aware of money habits, but not across the board and not too many. Do the research and figure out what can help you the most. Pine AI can.

Sources & Citations

• TIAA Institute–GFLEC Personal Finance Index (2025): https://www.tiaa.org/public/institute/publication/2025/financial-literacy-and-retirement-fluency-in-america
• World Economic Forum (2024): https://www.weforum.org/stories/2024/04/financial-literacy-money-education/
• WalletHub (2024): https://wallethub.com/edu/b/financial-literacy-statistics/25534
• WalletHub (2025): https://wallethub.com/edu/most-and-least-financially-literate-states/3337
• EduBirdie (2025): https://edubirdie.com/blog/how-does-gen-z-define-intelligence
• TIAA (2025): https://www.tiaa.org/public/institute/about/news/financial-literacy-and-wellness-among-us-women-gender-gap
• FINRA National Financial Capability Study (2024): https://www.finra.org/investors/insights/finra-foundation-national-financial-capability-study
• National Financial Educators Council (2024): https://www.financialeducatorscouncil.org/why-isnt-personal-finance-taught-in-school/
• Financial Educators Council (2025): https://www.financialeducatorscouncil.org/financial-illiteracy-costs/
• Consumer Finance (2025): https://www.consumerfinance.gov/about-us/blog/buy-now-pay-later-may-be-more-trouble-than-you-realize/
• Experian (2025): https://www.experian.com/blogs/ask-experian/how-to-build-credit/
• https://www.experian.com/blogs/ask-experian/how-does-credit-card-interest-work/