How many Americans are not financially literate?
Only about 57% of Americans are considered financially literate. Nearly 56% of Americans lose sleep over their money issues. About 40% of American adults would either borrow, sell something, or go into debt if faced with a $400 emergency expense.
Zippia notes that “[o]nly 36% of Gen Z are financially literate.” Older generations fare better, with 48% of Gen Xers and millennials considered financially literate and 59% of baby boomers. The disparity in financial literacy between men and women is also concerning.
Notably, a collaborative study by the TIAA Institute and the Global Financial Literacy Excellence Center (GFLEC) has found that only 43% of Gen Z respondents correctly answered questions related to financial literacy, indicating a significant gap in financial understanding within this demographic.
25% of Americans say they don't have anyone they can ask for trusted financial guidance. [7] By delivering valuable support to consumers on how to save, budget, invest, and manage their finances, businesses can serve as a much-needed resource to help them make better decisions and improve their financial standing.
In the two previous years' surveys – 2021 and 2022 – Americans said they lost $1,389 and $1,819, respectively, due to lack of personal finance knowledge.
Whether it's investment strategies, spending habits or confidence in their financial knowledge, each generation differs from one another when it comes to their finances. However, among all of the generations, it's Gen Z that is proven to have the lowest financial literacy levels.
Gen Zers face greater obstacles to financial success
Not only are their wages lower than their parents' earnings when they were in their 20s and 30s, but they are also carrying larger student loan balances.
A gigantic wealth transfer over roughly the next decade will likely make millennials "the richest generation in history," according to a report from global real estate consultancy Knight Frank.
Generation Z is racking up more credit card debt than previous generations, while Generation X holds the highest average of credit card debt, according to recent data from Credit Karma.
For example, a new study by the Investment Company Institute (ICI) finds that “Gen Z households have nearly three times more assets in the [retirement] plan accounts (adjusted for inflation) that Gen X households did at the same age.” More Gen Z-ers have retirement plans set up and they've saved more in those accounts.
How many Americans don't have $1000 in their bank account?
Already a subscriber? A stunning new Bankrate survey of 1,030 individuals finds that more than half of American adults (56%) lack sufficient savings to shoulder an unexpected $1,000 expense.
A majority, 65%, say they live paycheck to paycheck, according to CNBC and SurveyMonkey's recent Your Money International Financial Security Survey, which polled 498 U.S. adults. That's a slight increase from last year's results, which found that 58% of Americans considered themselves to be living paycheck to paycheck.
Most would not turn to cash savings because they don't have it, the personal finance website found. Fewer than half of Americans, 44%, say they can afford to pay a $1,000 emergency expense from their savings, according to Bankrate's survey of more than 1,000 respondents conducted in December.
A new GOBankingRates survey of more than 1,000 adults found that 28% of people have nothing saved for the future, 39% aren't contributing to a retirement fund and another 30% don't think they'll ever be able to retire. While these numbers worry the experts, they don't shock them.
About 29% of respondents have between $501 and $5,000 in their savings accounts, while the remaining 21% of Americans have $5,001 or more. Few hold much cash in their checking accounts as well. Of those surveyed, 60% report having $500 or less in their checking accounts, while only about 12% have $2,001 or more.
As of May 2023, more than 1 in 5 Americans have no emergency savings. Nearly one in three (30 percent) people in 2023 had some emergency savings, but not enough to cover three months of expenses. This is up from 27 percent of people in 2022. Note: Not all percentages total 100 due to rounding.
As societal trends continue to evolve, the narrative surrounding generational intelligence unfolds with fresh perspectives. A growing discourse suggests that Generation Z (Gen Z) is endowed with higher cognitive abilities compared to their predecessors, the Millennials.
The Silent Generation, also known as the Traditionalist Generation, is the Western demographic cohort following the Greatest Generation and preceding the baby boomers. The generation is generally defined as people born from 1928 to 1945.
More Millennial households are in poverty than households headed by any other generation. In 2016, an estimated 5.3 million of the nearly 17 million U.S. households living in poverty were headed by a Millennial, compared with 4.2 million headed by a Gen Xer and 5.0 million headed by a Baby Boomer.
Gen Z — the post-Millenial generation, born roughly between 1997-2012 — are mostly in their teens, but the oldest among them is already 22 and by 2025, they'll account for 27% of the workforce. The study shows that for workers ages 18 to 25, the median they have saved — across retirement accounts — is $33,000.
Why will Gen Z not retire?
This belief stems from a variety of factors, but a major reason is the current job market. Minimum wage is largely stuck at the same as it was 13 years ago and Gen Zers don't believe the pay they get for the work they do allows them a good quality of life, the McKinsey study cites.
King said millennials' purchasing preferences and the soaring cost of living has led many into "a vicious cycle of taking on more debt." Many were "forced" to rely on credit cards and loans to meet their needs, adding to their "crippling debt pile."
Baby boomers are often said to be the luckiest generation financially — but millennials will be better off than their parents in retirement, survey finds.
| Name | Age | Net Worth |
|---|---|---|
| Gustav Magnar Witzoe | 27 | $4.4 B |
| Steven Meng Yang & family | 38 | $4.2 B |
| Li Xiang | 39 | $4.0 B |
| Ben Silbermann | 38 | $3.9 B |
Gen Z is better off financially than their parents at the same age—but drowning in debt, Pew says | Fortune.
