Americans Lose Over $900 Due to Limited Financial Literacy
An absence of financial knowledge could cost participants more than they think.
Data from the National Financial Educators Council (NFEC) found that participants say they lose out on $948 from their lack of personal finance knowledge, for a combined total of $246 billion in lost revenue.
Further, close to half (48.6%) of survey respondents say that an inadequacy of their own financial prowess had led to losses of $500, while 14.6% report setbacks of $2,500. This is a slight decrease from 2024, where 50.2% of participants reported losses of $500 and 15.3% said they lost $2,500.
The findings underscore a current need for personal finance knowledge—especially as Americans grapple with high day-to-day costs, increased inflation, and a shortage of adequate short- and long-term savings, says NEFC.
Introducing financial literacy at a young age could help curtail insecurity as consumers age.
“Americans today need financial education more than ever before,” comments Vince Shorb, CEO of the NFEC. “Financial illiteracy has become an epidemic in this country. We need to start teaching comprehensive financial education to children early in life, so that all Americans have the knowledge they need to make the financial decisions they’ll face in the changing economic world. Our future depends on it.”
While the number continues to be high, it’s the lowest figure compared to past years’ findings. NFEC reported losses of $1,819 in 2022, $1,506 in 2023, and $1,015 in 2024 due to a shortage of personal finance understanding.
The research, conducted between December 24 and December 28, fielded responses from 1,200 individuals. The NFEC categorized respondents into six age groups, calculated the average amount reported, and then estimated the total amount of money lost in the U.S. due to low personal finance knowledge, based on the US Census Bureau estimate of 260 million adult residents.
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.