Americans’ financial literacy has fallen to its lowest level since tracking began a decade ago, with younger workers and women showing the widest gaps—and a growing number turning to AI for help.
The latest TIAA Institute–GFLEC Personal Finance Index, recently cited in Employee Benefit News, found that U.S. adults correctly answered just 47% of financial literacy questions in 2026, down two percentage points from the prior year. One in four Americans now has very low financial literacy, up five percentage points since 2017.
The findings arrive amid elevated economic stress driven by rising gas prices and persistent inflation. But Surya Kolluri, head of the TIAA Institute, points to other factors as well. “We’re also experiencing information overload from social media, which often floods the brain with stimulating, but not educational, content,” he said. “Since COVID, overall educational attainment has declined broadly, and financial literacy has followed.”
The survey measures knowledge across eight areas:
- Earning
- Consuming
- Saving
- Investing
- Borrowing
- Managing debt
- Insuring
- Comprehending risk
Persistent demographic gaps emerged. Men answered 50% of questions correctly on average, with 19% demonstrating very high literacy. Women answered 44% correctly, with just 11% in the highest category. The largest gaps were in investing, insuring, and comprehending risk.
“Left unaddressed, the gender gap in financial literacy becomes a gender gap in retirement security,” Mr. Kolluri said. “That matters enormously given that women on average live longer, experience more career interruptions, and may enter retirement with less accumulated savings.”
Gen Z fared worst of all. They answered just 38% of questions correctly—well below every other generation—and more than one in three Gen Z adults fall into the very lowest knowledge category.
For the first time, the survey also asked about AI. While 19% of adults report having used an AI tool to get information about a personal finance topic, only 4% use AI regularly to manage their finances. Younger generations are leading the way: 29% of Gen Z and 24% of millennials have used AI for personal finance information, compared with just 8% of boomers. Roughly one in five Gen Z adults and 16% of millennials say they regularly or occasionally rely on AI to help manage their finances.
The link between literacy and outcomes remains strong. Adults with low financial literacy are four times more likely to have trouble making ends meet, more than twice as likely to be debt-constrained, and three times more likely to be financially fragile.
Mr. Kolluri says employers can help close these gaps, but only if they tailor education to where employees actually are in life. “Information about paying off student loans won’t resonate with a 55-year-old facing caregiving costs,” he said. “Matching content to life stage is what closes the gap.”
