50 Alarming Statistics on Financial Literacy in the US

As an adult, have you ever reflected on your high school or college education and asked yourself, “Why didn’t they teach that in school?”. Unfortunately, schools in the United States have a poor track record of educating young students on personal finance.

How is it that I made it through 18 years of schooling and a graduate degree without taking a single finance class? It’s difficult to understand how personal finance and investing aren’t prerequisites for high school graduation in all US states.

In this article, I’ll review 50 alarming stats on US financial literacy that’ll have your eyes popping.

50 Alarming Statistics on Financial Literacy in the US

1. 74% of teens don’t feel confident about their financial education (Greenlight)
2. Only 52% of teens say they are learning about personal finance at school (Greenlight)
3. 48% of teens are learning about investing from social media such as YouTube and TikTok (Greenlight)
4. 86% of teens are interested in investing, but 45% say they haven’t started because they don’t feel confident (Greenlight)
5. Nearly 50% of high school seniors say they wish they learned personal finance in school (finEDge)
6. Differences in financial knowledge account for 30-40% of retirement wealth inequality (Lusardi, Michaud, & Mitchell)
7. 46% of teens don’t know what a 401(k) is (Greenlight)
8. Only 31% of Americans agreed that their high school education did a good job of teaching them healthy financial habits (Bank of America)
9. 27 states scored a C, D, or F for high school financial literacy (Champlain College, Council for Economic Education)
10. Only 17 states mandate that high school students complete a course in personal finance (Next Gen Personal Finance)

11. Less than 20% of teachers report feeling “very competent” to teach personal finance topics (UW-Madison)
12. Only 34% of Americans can answer at least four of five basic financial literacy questions (FINRA Investor Education Foundation)
13. 68% of adults live paycheck to paycheck (CNBC)
14. Only 1/3 of states require students to take a personal finance class in order to graduate (Survey of the States)
15. 53% of adults are financially anxious (2018 FINRA study)
16. Two in three families lack an emergency fund (NY Times)
17. 38% of teens lack basic knowledge of how education ties to jobs (Gobankingrates)
18. Three in five adults don’t keep a budget (NFCC)
19. Four in five youths failed a financial literacy quiz (MarketWatch)
20. About 4 in 7 Americans are financially illiterate and report being unable to manage their finances (Walden University)

21. 54% of millennials are concerned about student loans (PwC)
22. 60% of adults had credit card debt in the past year (Bloomberg)
23. 73% of teens say they want to learn more about personal finance (Greenlight)
24. 12% of 2014 college graduates have loans in default (Default Rates for Schools, Financial Educators Council)
25. 42% of millennials took out an alternative financial service (PwC)

26. 40% of individuals with low levels of financial literacy relied on parents, friends, and acquaintances as their most important source of financial knowledge, compared to 21% of those with the highest levels of financial literacy (Rooij, Lusardi & Alessie)
27. Only 23% of kids talk to their parents frequently about money (Money Confident Kids)
28. 54% of teens don’t feel ready to take on future financial challenges (Gobankingrates)
29. 69% of teens say rising education costs have affected their plans for additional education after high school (Gobankingrates)
30. 39% of teens said a better understanding of how student loans work could help them address some of their financial concerns (Gobankingrates)

31. 41% of teens said they have had no financial literacy classes in school (Gobankingrates)
32. 32% of teens can’t identify the difference between a credit card and a debit card (Greenlight)
33. 1 in 3 Americans delayed a major decision due to finances (AICPA)
34. Americans pay an average of $577 in late fees, overdrafts, and fraud-related charges annually (CNBC)
35. 21% of Americans have no emergency savings (Bankrate)
36. 4 out 5 parents wish they learned more about money as a kid (studyfinds)
37. State-mandated financial education graduation requirements decrease the likelihood of carrying a credit card balance (NEFE)
38. 59% of parents are uncomfortable talking to kids about money (studyfinds)
39. 38% of adults have less than $1,000 saved for financial emergencies (PwC)

40. 19% of Americans report spending more than their income in the past year (FINRA Investor Education Foundation)
41. Only 24% of millennials demonstrate the ability to understand basic financial concepts (GFLEC) 
42. Nearly 60% of parents report giving their kids financial help in the past year (Pew Research Center)
43. Financial illiteracy cost each American about $1,600 on average in 2020, and $415 billion nationally (National Financial Educators Council)
44. In 2019, 70% of high schoolers in America had the option to take a personal finance course, but only 17% of students were required to take one (Council for Economic Education)
45. 12% of adults wouldn’t be able to pay their monthly bills if they incurred an unexpected expense of $400 or more (Board of Governors of the Federal Reserve System)
46. 70% of teens say that rising higher education costs have affected their post-graduation plans (CNBC)
47. 73% of people with high financial literacy scores claimed to gain their education from personal experience (Federal Reserve Bulletin)
48. Minority groups, on average, have between 9% and 16% lower financial literacy scores compared to Caucasians (AEA Web)
49. Women are less likely than men to be offered financial education (FINRA Investor Education Foundation)
50. African Americans have a lower level (41%) of financial literacy than the national average (48%) (Walden University)

Bottom line

Survey after survey and study after study conclude the same thing: the United States education system is failing a lot of our young students when it comes to personal finance. While more states have mandated personal finance be a prerequisite for graduation, there are still many that have not.

Hopefully, the US can continue making positive strides in personal finance education and cause a large portion of these stats to fall off the list.