Financial Literacy Gaps Across Generations

Financial Literacy Gaps Across Generations

Most U.S. adults have a beginner’s understanding of cryptocurrency, but plan on using such assets as a key source of retirement funds, according to a new multi-generational financial literacy study from Investopedia. 

In the spirit of Financial Literacy Month this April, Investopedia asked 4,000 U.S. adults—1,000 each from Generation Z (18-25), millennial (26-41), Generation X (42-57), and baby boomer (58-76) generations—about their financial know-how, habits, worries, and retirement plans. The 2022 Investopedia Financial Literacy Survey found Americans are simultaneously trying to grasp personal finance basics, thinking about retirement, and investing in crypto. They learn differently than older generations, too.

Key Takeaways

  • 57{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} U.S. adults are invested, but just 1 in 3 say they have advanced investing knowledge. 
  • About half of all surveyed adults feel they have a deep understanding of consuming (managing spending and keeping a budget), paying taxes, and saving. 
  • Cryptocurrency and stocks are the most popular assets held by Gen Z, Millennial, and Gen X investors, but overall, many Americans (49{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}) have only a beginner-level understanding of digital currency. 
  • More than half of each generation expects to retire, and 28{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of millennials expect to use cryptocurrency to financially support themselves in retirement, and some Gen X and Gen Z respondents said the same (20{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} and 17{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, respectively).
  • The internet is a go-to source for investing and financial education for the young generations: 45{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of Gen Z use YouTube, and 30{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} turn to TikTok. Millennials prefer internet searches (47{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}), but also lean on YouTube (40{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}).

“Our relationship to money, investing and financial planning has radically changed in the past few years, as new asset classes like crypto and NFTs have emerged just as millions of people are taking their first steps into investing,” said Caleb Silver, Editor-in-Chief of Investopedia. “What hasn’t changed is the need for relevant financial education—but in a modernized curriculum that addresses these new financial products and services, designed to serve the people who are dependent on them to build their wealth.”

U.S. Adults Have More to Learn About Crypto, Investing

While about half of Americans feel they have a strong grasp of financial literacy basics, such as spending, budgeting, paying taxes, and saving, far fewer have the same level of understanding when it comes to investing and digital currency.

Overall, 57{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of adults Investopedia surveyed are invested, but just 1 in 3 say they have advanced investing knowledge. Even fewer (1 in 4) reported strong knowledge of digital currency, such as cryptocurrency, blockchain, and non-fungible tokens (NFTs). 

Millennials said they understand investing the most, as 44{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} reported advanced knowledge on the subject. Gen X follows closely behind (37{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}), followed by Gen Z (31{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}), and baby boomers (26{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}). 

Even fewer people have a strong grasp on digital currency, such as cryptocurrency, blockchain, and NFTs, topics that Investopedia has already seen substantial interest in over the past year in particular. Half of all survey respondents (49{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}) said they only have a beginner’s understanding of increasingly popular aspects of financial technology. 

Millennials are the most confident—41{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} said they have an advanced understanding of digital currency. Similarly, 39{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of millennials said they could explain cryptocurrency to someone else, but only 25{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} said the same about NFTs. 

Members of Gen Z, which have grown up immersed in technology, and Gen X are on about the same level with crypto (30{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} and 29{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, respectively), and baby boomers’ knowledge trails behind at just 8{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}. 

Despite Knowledge Gaps, Most Generations Hold Crypto

While most adults have more to learn about digital currency, that hasn’t stopped them from investing in related assets, which indicates more emerging technology education is needed to meet people where they are.

Crypto-enabled investments are popular among three of the four generations surveyed by Investopedia: Gen Z, millennials, and Gen X. A steep 38{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of millennials said they have some kind of cryptocurrency investment in their name, making it the most common investment this generation holds and just as popular as investments in stocks. 

Gen Z and Gen X are not far behind, with cryptocurrency as their second most popular type of investment. Only 6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of the baby boomers Investopedia surveyed said they hold cryptocurrency. 

Millennials might be most keen on crypto, but Gen Z and Gen X are equally bullish. When asked what asset they expect to yield the greatest returns for them over the next decade, all three generations said cryptocurrency, followed by stocks. These predictions follow years of climbing Bitcoin return values and a flood of new investors during the pandemic, driven by easy-to-use online brokerage platforms, social media conversations, and an evolving tech industry.

Baby boomers think their stocks and mutual funds will produce the greatest 10-year returns, but cryptocurrency still surpassed more traditional investment vehicles such as index funds and ETFs.

Other Financial Literacy Needs Align With Life Stage

The 2022 Investopedia Financial Literacy Survey affirmed that younger generations feel like they have more to learn about personal finance fundamentals, while older generations are focused on planning for the future and maintaining wealth. While this might be expected, given life stage experiences, it reinforces the need for ongoing financial education.

Gen Z, the youngest adults surveyed, said they are least educated when it comes to taxes, borrowing, insurance, and retirement. They are also the generation that wants to learn more about doing their taxes: 34{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} said that’s the most important financial skill they could learn today. 

Millennials, who have a few more years of life and work experience under their belt, feel more informed when it comes to savings, investing, and cryptocurrency than other generations. They also have their eyes on improving credit scores, which is key for many common mid-life financial moves such as buying a home or car. 

Members of Gen X, many of whom are nearing the average retirement age, are most interested in saving for retirement. Baby boomers, many of whom are already retired according to the survey, are most interested in learning how to better protect their wealth by securing their personal online financial information. 

Two personal finance topics all four generations agree are some of the most important skills they could learn more about? Avoiding fees and reducing debt. 

Young Americans Have Their Eyes On Retirement

Despite navigating several periods of economic uncertainty over the past decade, namely the recent COVID-19 pandemic, younger generations are quite optimistic about their ability to retire.

When asked when they expect to stop working, Gen Z cited a median age of 57. Each successive generation expects to stop working at slightly later ages, but Gen X, who are up next for retirement, still say “64” as their median number, in line with the national average for both men and women. 

Overall, more than half of each generation fully expects to be able to retire, while an additional around 1 in 4 say they’re not sure, indicating there are still opportunities for more retirement planning education and wealth management guidance across generations.

Cryptocurrency Is Appearing in Retirement Strategies

Just as portfolios are evolving with technology, so are retirement plans. The 2022 Investopedia Financial Literacy Survey found that while most of each generation still expects to rely on traditional income sources such as 401Ks and social security when they stop working, cryptocurrency has also made the shortlist. 

More than a quarter of millennials (28{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}) said they expect to use cryptocurrency to support themselves in retirement, on par with savings (25{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}) and stock market investments (27{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}). A notable portion of Gen X and Gen Z respondents said the same (20{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} and 17{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, respectively).

“For younger investors, cryptocurrency is clearly not just a fun asset to trade in order to make fast money,” said Silver. “They are depending on generating returns from cryptocurrency to build wealth and fund their retirement, which is concerning given the lack of education around investing in crypto, and the fact it is still not regulated by the industry.”

Education Needs To Meet People Online 

When asked where they get their investing information, all four generations surveyed by Investopedia said friends, family, and the internet are go-to education sources. Perhaps unsurprisingly, young adults that have grown up with social media and the internet say they rely more on digital, often video-based, content to learn about investing and personal finance.

A steep 39{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of Gen Z investors said they get investing insights from Youtube, and another 1 in 4 turn to TikTok and Instagram. Millennial investors are more keen on internet searches (47{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}), but also rely on YouTube videos to learn about investing (40{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}).

The internet is a go-to source of guidance for older generations, too. YouTube is just as popular among Gen X investors as it is for millennials. Baby boomers are the most likely generation to go directory to financial information websites like Investopedia for investing insights. 


The 2022 Investopedia Financial Literacy Survey quantifies U.S. adults’ understanding of their own financial literacy on a generational-level. The survey was fielded via an opt-in, online self-administered questionnaire between January 27-February 7, 2022 to 4,000 U.S. adults, 1,000 from each of the following generations: Gen Z (18-25), millennials (26-41), Generation X (42-57), and baby boomers (58-76). To ensure representation within each generation, sub-quotas were used within each generation to ensure representation across gender, region, and race/ethnicity. To learn more, see the full methodology. 

Survey research and data analysis led by Amanda Morelli.