Financial literacy and wellness among U.S. women: Variations among women
Financial literacy among women varies across socioeconomic and demographic groups (Figure 4).
Financial literacy tends to be lowest among Gen Z women and highest among Gen X and baby boomers. Gen Z correctly answered 37% of the index questions, on average, compared with 51% among Gen X and 53% among boomers. While generation and age effects cannot be distinguished in a single cross-section of data, these findings stand out for how little young women seem to know given the complexity of today’s financial environment.
Financial literacy tends to be greater among women with higher household incomes. There is a significant 25 percentage point difference in P-Fin Index questions answered correctly between women with household incomes below $25,000 and those with household incomes of $100,000 or more.
Personal finance knowledge varies with employment status. In particular, unemployed or disabled8 women have markedly lower financial literacy than those employed9 and those retired.
Financial literacy also varies among women depending upon family status (Figure 5).
Even though they are de facto responsible for making their own financial decisions, women who have never been married tend to have lower financial literacy. They correctly answered 41% of the index questions, on average. By comparison, women who are married or living with a partner and women who are widowed or divorced correctly answered approximately 50%.
At the same time, women with children under age 18 tend to have significantly lower financial literacy than those with no children under 18.
Finally, financial literacy tends to be greater among women with more education and those who have received financial education (Figure 6).
Women with a college degree correctly answered 61% of the P-Fin Index questions, on average, compared with 26% among those with less than a high school degree.
There is a 13 percentage point difference in the percentage of index questions answered correctly between women who have participated in a financial education class or program and those who have not.10
8 Includes those unemployed or on temporary layoff, as well as those disabled and unable to work.
9 Includes those employed full time, part time and self-employed.
10 See Lusardi and Mitchell (2014) for a discussion of existing research regarding the relationship between financial education programs and financial literacy levels, as well as the challenges inherent in empirically establishing causality and effectiveness.