Only 5% of U.S. Adults Can Ace This 8-Question Financial-Literacy Test. Can You?

WASHINGTON, July 9, 2026 — Financial literacy is a major concern among U.S. adults, according to the 2026 TIAA Institute GFLEC Personal Finance Index. An eight-question test created by the TIAA Institute and the Global Financial Literacy Excellence Center (GFLEC) found that only 5% of U.S. adults answered all eight questions correctly. The assessment examines how well people understand important personal finance topics, including saving, borrowing, spending, investing, and financial decision-making.

The 2026 report marks the 10th consecutive year that the TIAA Institute and GFLEC have assessed financial literacy among U.S. adults. Researchers found that average scores reached their lowest level since the survey began, with a five-percentage-point decline in financial literacy since 2020. The results show that many adults face difficulties understanding financial concepts that influence everyday financial choices, retirement preparation, debt management, and long-term financial planning.

Eight Questions Reveal Widespread Gaps in Personal Finance Knowledge

The eight-question financial literacy test was designed to measure basic understanding of money-related topics, but the results show that many adults struggle with fundamental concepts. Only 5% of participants achieved a perfect score, while 13% answered none of the questions correctly. The average U.S. adult correctly answered fewer than four of the eight questions, with the average score reaching 3.7. Researchers noted that the purpose of the test is not to judge individuals but to identify areas where financial education can help people make better financial decisions.

The findings highlight the importance of understanding concepts such as interest rates, inflation, savings, investments, and debt. Financial knowledge can help individuals evaluate financial products, understand risks, prepare for future expenses, and make informed choices. The results suggest that many Americans may need greater access to financial education resources that explain essential money concepts and support stronger financial habits.

Financial Literacy Linked to Stronger Financial Outcomes

The report found a strong relationship between financial literacy and financial well-being. Compared with adults who demonstrated very high financial literacy, those with very low financial literacy were four times more likely to struggle with making ends meet. They were also more than twice as likely to experience debt limitations, three times more likely to be financially fragile, and four times more likely to lack enough nonretirement savings to cover one month of living expenses

The study also found that adults with very low financial literacy were more than three times as likely to spend 10 hours or more each week thinking about and dealing with personal finance problems. Annamaria Lusardi, a Stanford University economics professor and co-author of the 2026 Personal Finance Index report, said financial knowledge and education generally lead to better financial outcomes rather than financial success, creating knowledge afterward. The findings show that understanding money matters can influence daily financial decisions and long-term financial security.

Early Financial Education Can Help Build Stronger Money Skills

Researchers highlighted the value of introducing financial education before people begin investing or making major financial decisions. Lusardi noted that financial education is especially effective when provided during high school or college because individuals have not yet developed certain investment habits or biases. Education later in life remains useful, but changing established financial behaviors can become more difficult after people begin participating in financial markets.

Financial literacy programs in schools, colleges, workplaces, and communities can help individuals understand saving, investing, borrowing, and managing expenses. Building financial knowledge earlier can give people a stronger foundation before they face decisions involving retirement savings, credit, investments, and major purchases. The report suggests that access to financial education throughout life can help more people develop the skills needed for responsible financial decision-making.

Why Financial Knowledge Matters More in Today’s Economy

The latest TIAA Institute GFLEC Personal Finance Index comes at a time when individuals face a wide range of financial responsibilities. Managing retirement accounts, investments, debt, household expenses, and changing financial conditions requires a stronger understanding of personal finance. Lusardi noted that financial literacy matters more than ever because financial markets face new risks and often respond in ways that may be difficult for many investors to understand.

The eight-question test serves as a reminder that financial education remains an important area for improvement among U.S. adults. With only a small percentage achieving a perfect score, the findings highlight the need for greater access to financial learning opportunities. Greater knowledge of personal finance concepts can help individuals make informed choices, prepare for future needs, and develop stronger financial habits over time.