Financial Literacy Among American College Students (2024)

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Financial Literacy Among American College Students? ›

While personal finance is becoming a required course in many American high schools, more than 40 percent of college students are still not equipped with adequate financial literacy knowledge and skills.

Many college students graduate without understanding how to manage their money effectively, which often leads to financial struggles later in life. In fact, according to research, more than 40 percent of college students are not equipped with financial literacy knowledge and skills.

Without the necessary financial skills, students may struggle to manage their debt or pay off their loans, leading to long-term financial consequences. It's time for schools to prioritize financial literacy education to equip students with the knowledge and skills they need to navigate their finances effectively.

The Ohio State University's National Student Financial Wellness Study found that 72 percent of college students experience financial stress stemming from the fear of being unable to meet tuition costs (60 percent) and meet monthly expenses (50 percent).

Only 57% of adults in the United States are financially literate. Missouri, Utah and Virginia boast the best financial literacy rates, while Alaska, Washington, D.C. and South Dakota have the worst financial literacy rates.

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.

Forty-one percent said they “never” or “rarely” did so. Students do not receive much formal education on handling their finances before college, the survey found. Only 17% said they learned to budget in school, while 42% learned to do so from their parents or other relatives, and 37% taught themselves.

Banking on Knowledge: Financial Literacy Among American College Students. While personal finance is becoming a required course in many American high schools, more than 40 percent of college students are still not equipped with adequate financial literacy knowledge and skills.

Financial distress is prevalent among undergraduates nationally, with almost three in four students experiencing financial difficulties in the past year, according to the fall 2022 Student Financial Wellness Survey.

In a survey of about 30,000 college students from more than 440 schools across the country, only 53% said they felt prepared to manage their money, according to a 2019 report by EVERFI, sponsored by AIG Retirement Services.

Are most college students financially independent? ›

Most college students work—many full time—while supporting themselves through school. The facts about working adults: 64% of college students work, and 40% work full time. 49% of college students are financially independent from their parents.

College students in the US spend an average of $600 on rent, $413 on books, between $40 and $180 a week on alcohol, and $159 on back-to-college shopping, while funding 92% of their college education using financial aid and having a median income of $34,089 a year.

A prolonged stretch of sinking enrollments, a global pandemic, uncertainties in state funding, a public increasingly skeptical of their value and their own tendencies to overbuild and overspend have left hundreds of colleges facing unsustainable futures.

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.

Financial literacy skills are important for people who use payment, savings, credit, and risk-management products.

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.

About one in four learned about money through a high school class, yet only 11 percent have become knowledgeable through a for-credit or noncredit program in college.

Highlights: Financial Literacy In America Statistics

Approximately 63% of Americans could not pass a basic financial literacy quiz. About 25% of Americans have nothing saved for emergency expenses. Only about 16.4% of U.S. students are required to take a personal finance class in schools.

As of the 2015-16 academic year (the most recent data available), about 20 million students were enrolled in undergraduate education, up from 16.7 million in 1995-96. Of those enrolled in 2015-16, 47% were nonwhite and 31% were in poverty, up from 29% and 21%, respectively, 20 years earlier.

Only 27 percent of California high school students attend schools that offer personal finance classes.