Gen Z has the lowest financial literacy, study finds

Although financial literacy tends to be highest among baby boomers and the silent generation, the average percentage of questions answered correctly is still only 55% for each. Among Gen X, Millennials, and Gen Z, the percentage of correct answers to the P-Fin Index questions are 49%, 48%, and 43%, respectively.

While Gen Z has the lowest levels of financial literacy, trends in financial wellbeing indicators show that Gen Xers face the greatest financial challenges. Twenty-eight percent of Gen X respondents report having difficulty making ends meet in a typical month, significantly more than any other generation. About 20% of Gen Z, Millennials and Baby Boomers, and 11% of the Silent Generation say they struggle to make ends meet.

“These results indicate that individuals generally start adulthood with low financial literacy and although it increases over time, financial literacy nevertheless tends to remain low,” said the TIAA Institute’s senior economist. . Paul Yakoboski. “Furthermore, financial well-being across generations tends to be more compromised among people with low levels of financial literacy.”

The economic uncertainty created by the COVID-19 pandemic has underscored the need for Americans to improve their personal financial knowledge, and 39% of survey respondents now say they are motivated to focus on their financial literacy. This feeling is more common among younger generations, with Gen Z, Y and X respondents reporting feeling the most focused (52%, 48% and 44%, respectively).

“The number of Americans who lack financial literacy, especially among our younger generations, is deeply concerning,” said Annamaria Lusardi, Founder and Academic Director of GFLEC and University Professor at GW. “Until financial education is offered in schools, colleges and workplaces, we will continue to see generations of adults struggling with their personal finances.”

The P-Fin Index is an annual barometer of the financial literacy of the American adult population. It measures the knowledge and understanding that enables sound financial decision-making and effective management of personal finances. The P-Fin Index is based on responses to a 28-question survey covering eight domains in which individuals inherently function.

  • Earnings: determinants of salaries and net salary.
  • Consume: budgets and expense management.
  • Savings: factors that maximize accumulations.
  • Investment: types of investment, risk and return.
  • Borrow/Manage Debt: Relationship between loan features and repayments.
  • Insure: types of coverage and how insurance works.
  • Understand risk: Understand uncertain financial outcomes.
  • Go to sources of information: recognize appropriate sources and advice.

The full report is available [HERE].

About the TIAA Institute
The TIAA Institute helps advance the way individuals and institutions plan for their financial security and organizational effectiveness. The institute conducts extensive research, provides access to a network of thought leaders, and enables those it serves to anticipate trends, plan future strategies, and maximize the chances of success. For more information about the TIAA Institute, visit

About TIAA
TIAA is a leading provider of secure retirement and results-driven investment solutions for millions of people and thousands of institutions. It is the premier not-for-profit provider of the retirement market,1 paid more than $3.6 billion to retired customers in 2020 and $1.3 trillion assets under management (as of 06/30/2021).2

The Global Financial Literacy Center of Excellence (GFLEC) is dedicated to advancing research and solutions that open the door to universal financial literacy. By working towards this mission, GFLEC has positioned itself as the world’s leading incubator for financial literacy research, policy and solutions. GFLEC launched in 2011 in George Washington University School of Business in washington d.c. Since then, he has developed groundbreaking tools to measure financial literacy, developed and advised on educational programs, and crafted policy guidelines aimed at advancing financial literacy in the world. United States and around the world. For more information on GFLEC, visit

1 Based on data from 56 providers in PLANSPONSOR Magazine’s 2019 DC Recordkeeping Survey, combined 457, 403(b) and DC plan data at December 31, 2018
2 Based on approx. $1.3 trillion assets under management in Nuveen’s subsidiaries and TIAA’s investment management teams as of 06/30/2021.


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Sarah J. Greer