Millennials Facing Weak Grasp On Financial Literacy
Millennials face greater economic challenges than previous generations and are already financially fragile. Millennials & Financial Literacy—The Struggle with Personal Finance, a study conducted by The Global Financial Literary Excellence Center (GFLEC) at the George Washington University with the support of PwC, showed a majority of millennials are struggling to understand fundamental financial concepts and to manage their debt.
According to a recent press release, the study found that only about 24 percent of millennials demonstrate basic financial knowledge. About 55 percent of graduates have student loans, including 34 percent of young adults with annual incomes of more than $75,000. More than half of millennials carried over a credit card balance in the last 12 months and 45 percent make minimum monthly payments. Additionally, nearly half of the millennials said they could not come up with $2,000 within the next month to meet an unexpected need.
Though millennials are clearly experiencing financial issues, they are afraid to ask for help. The study showed that only 27 percent seek professional financial advice. The gap between the amount of financial responsibility given to millennials and their demonstrated ability to manage personal finances is widening, and to reduce that gap, young people need to be empowered to make smart financial decisions.
In 2012, PwC launched a commitment called Earn Your Future (EYF), focused on helping young people develop critical financial skills and to provide educators with resources and training to teach financial literacy. PwC extended this commitment in 2015 to total $190 million.
As college students, it is important to save rather than spend, and to learn how to boost your credit score. For more information, visit pwc.com/us/millennialsfinlit.