What percent of Gen Z is financially literate?
The low proficiency in financial literacy among Gen Z, as evidenced by only 24% of respondents being able to answer basic financial questions correctly in the FINRA survey, points to an urgent need for comprehensive financial education efforts aimed at young people.
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.
Within Gen Z, financial literacy tends to be lowest among those who have never attended college. On average, this group correctly answered only 39% of the index questions. Across generations, financial literacy tends to be greatest in the areas of borrowing and saving.
Aligning on money is all the more pressing for younger generations, who are earlier on in their relationships and careers—nearly half (49%) of Gen Zers view financial compatibility as more important than physical compatibility. That's compared to 40% of millennials, 35% of Gen Xers, and 30% of baby boomers.
Gen Z is stressed out about their finances. So, they're working to establish good money habits now. They may be young, but Gen Zers' lives have already been riddled with financial obstacles, including record high inflation and bloated education costs.
Gen Z faces unique financial challenges compared to older generations. College graduates earn 10% less compared to their parents, recent research found. High inflation — and affordability concerns among Gen Zers — extend beyond U.S. borders.
In many ways, Gen Zers are better off than their parents were 30 years ago, but fewer are financially independent — here's why. Compared with their parents at this age, today's young adults are more likely to have a college degree and work full time, according to a recent report by the Pew Research Center.
Generation Z
Thus, those in Gen Z are currently between the ages of about 11 and 26. As might be expected due to their relatively young ages, data shows that Generation Z demonstrates the lowest level of financial literacy among Gen Z, Gen X, boomers and millennials.
Gen-Z Faces Financial Challenges, Stress, Anxiety And An Uncertain Future.
Generation Z students are on track to become the most educated generation. They have higher high school graduation rates and lower dropout rates than those who came before. In 2018, 57% of 18 to 21-year olds were in college, compared with 52% of Millennials, and 43% of Gen Xers at similar ages.
Do Gen Z think they will be rich?
A staggering 75% of Gen Z high-net-worth individuals expect to see their wealth increase in 2024. Of that group, 43% even expect to see “significant growth.” What's more, Gen Zers aren't just feeling confident about their financial game in 2024—they stand out as the most self-assured generation of all.
Gen Z's Philanthropic Potential
The good news, however, is that this limitation doesn't deter them from contributing to causes they care about however they can. “[I]n 2022, Gen Z adults made an average of 5.3 donations — notably more than the 4.8 made by millennials and 4.7 made by Generation X.”
- Baby boomers have the highest net worth per household. ...
- Baby boomers have the most in assets, with fuller retirement funds and more wealth in stocks and real estate. ...
- Gen X holds the most in liabilities, despite holding fewer assets than baby boomers and the silent generation.
It's a relatively new term, so what does soft saving actually mean? Put simply, it's the practice of using more money for the present, rather than putting it away for the future — in line with how Gen Z prioritizes maximizing their experiences.
“The reason that millennials don't save as much as Gen Z is likely because they have more financial responsibilities,” Adams said. “For instance, many are homeowners, have families and pay higher ongoing expenses, such as groceries, clothing, insurance and medical costs.”
They're saving earlier than generations before them, making long-term money goals, and becoming financially independent sooner.
Generation X averages $61,036 in debt, followed by baby boomer members, who have an average total debt of $52,401. The youngest Credit Karma members, those of Generation Z, carry the least total debt on average — $16,283 — followed by members ages 78 to 95, the Silent Generation.
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.
Nearly Half of Gen Z and Gen X Have $0 Saved for Retirement
According to GOBankingRates' survey, 29% of overall Americans have not started saving for retirement and 20% have saved $10,000 or less. Motivation to save for retirement varies vastly among generations.
McKinsey research indicates that Gen Z is willing to spend on experiences that enrich their daily lives (though how they determine what enriches their lives, like spending on wellness and self-care, differs from previous generations).
Does Gen Z care about financial literacy?
The low proficiency in financial literacy among Gen Z, as evidenced by only 24% of respondents being able to answer basic financial questions correctly in the FINRA survey, points to an urgent need for comprehensive financial education efforts aimed at young people.
Gen Z on track to be the best-educated generation yet
A look at older members of Generation Z suggests they are on a somewhat different educational trajectory than the generations that came before them. They are less likely to drop out of high school and more likely to be enrolled in college.
Gen Z is also the smartest and best educated generation. Having an unlimited wealth of information at our disposal has not gone to waste. In America, 57 percent of Gen Z is reported to have enrolled in a two-year or four-year college, compared to 52 percent of Millenials and 43 percent of Gen X.
Gen Z is richer than just a few years ago—and much richer than their parents at the same age—but everything costs more and they have more debt, Pew study reveals. Gen Z is making more money than their parents at their age, but they still have to deal with higher costs of buying a home and college.
Gen Z and mental health. Regarding the stats, it's clear that Gen Z is struggling. A 2022 survey of Gen Z young adults (ages 19 through 24) found that 42% are diagnosed with a mental health condition.
