The 2019 TIAA Institute-GFLEC Personal Finance Index: Is Financial Literacy Improving

Financial Literacy in the United States and Its Link to Financial Wellness

Is financial literacy improving?

The percentage of P-Fin Index questions answered correctly increased from 49% in 2017 to 50% in 2018 to 51% in 2019 (Figure 3), while the percentage of adults answering more than one-half of the questions correctly increased from 48% to 51% to 53% (Figure 4).7 While these results are noteworthy given that they hint at the possibility of a slow increase in financial literacy, the changes are too small, and the time period too short, to conclude that financial literacy levels are actually increasing.

P-Fin Index Figure #3
P-Fin Index Figure #4

While the relative rankings of knowledge across functional areas remains almost unchanged over the first three waves of the P-Fin Index—borrowing is where knowledge is highest and comprehending risk is where it is lowest— six of the eight functional areas saw small increases in the percentage of questions answered correctly (Figure 5). More sizeable changes occurred in the areas of saving, earning and go-to information sources. While small, these changes are in the right direction.

P-Fin Index Figure #5