5 Reasons Financial Literacy Matters Now More Than Ever

There is a broadening financial literacy knowledge gap in the U.S. Personal finance isn’t a required class to graduate in over half of U.S. high schools, and 4 out of every 5 adults stated in 2023 they’ve never received a personal finance education in school! 

We’re seeing the impact of this void as the U.S. hit the highest level of credit card debt in history.  We’re on a mission at uThrive Academy to turn this “niche” into a mainstream conversation and bridge the gap because, while the Geometry you learned in school may not be put to use in the real world, financial literacy definitely is, for every person!

Let’s break down the 5 reasons why financial literacy matters now more than ever.

Reason #1: Social media is filling the financial literacy void left by schools 

According to a U.S. Financial Literacy and Education Commission study, only 1 in 3 US adults could answer at least 4 of 5 basic personal finance questions… because again, not taught or adequately taught in schools. 

To fill these longstanding voids, 40% of Americans have turned to family, friends, and coworkers for financial advice. Interestingly enough, 40% feel they don’t have any trusted voices to turn to, according to a National Financial Educators Council poll. 

Image source: www.financialeducatorscouncil.org/financial-guidance-survey/

The result: 76% of Gen Zers are turning to social media to learn about basic personal finance topics like budgeting, passive income, and stock investing. The problem with this is that 83% agree they receive misleading information! 

With viral TikTok challenges like doom spending and soft savings, which encourages young people to lavishly spend today without saving and planning for the future, is this really where we want our young people getting their financial advice?!

Reason #2: Money-related stress and physical health deterioration is on the rise 

In our modern fast-paced life, stress is probably the most common element in everyone’s life. While it’s normal to get stressed about work or strained relationships, money-related stress now eclipses these two common stressors. 

According to a Marketwatch survey, 9 out of 10 respondents (88%) reported feeling financially stressed while 65% stated that their finances are the most stressful aspects of their lives! High essential good prices, lack of savings, lack of income, and debt rank among the highest financial stressors, and almost half report avoiding looking at their checking account out of fear to see the balance.

The feeling of losing control over money is inducing anxiety and contributing to sleep loss, headaches, and weight fluctuations, according to 92% of survey participants. This loss of control is particularly acute amongst young Americans who have less assets to fall back on and are YOLO spending. 

For example, nearly 1 in 3 Gen-Zers think that their finances could lead them to experience homelessness. Constant stress leads to anxiety, depression, and even suicidal tendencies. Here is a worrying statistic: someone facing financial stress is 20 times more likely to attempt suicide! 

Reason #3: Household debt is at an all-time high 

Millions of Americans entered into 2024 with more debt to their names and lower bank balances than ever before. In 2024, U.S. household debt reached a staggering $1.73 trillion, surpassing the previous high. 

The average U.S. household debt in 2023 was $104,215 across mortgage loans, auto loans, credit card debt, student loans, and personal loans. Credit card debt (also one of the costliest types of debt) experienced the highest spike - 16.6% between November 2022 and Nov 2023. 

Image source: marketwatch.com

With debt being one of the highest stressors, getting quality personal finance education is imperative to helping you better manage your money and develop solid debt repayment strategies to escape debt traps. 

Reason #4: Money is affecting relationships like never before

Money is one of the most common things couples argue about. While it’s a healthy habit to honestly discuss money matters with your partner, financial stress can strain relationships. 

With rising financial insecurity, low savings, and high debt, maintaining healthy relationships is getting increasingly difficult. In fact, money is the leading cause of divorce. Around 41% of divorced Gen Xers, along with 29% of divorced Boomers state that the reason their marriages ended was due to financial disagreements. 

This topic is so important that uThrive devotes an entire lesson to discussing how to have healthy financial relationships in our ultimate course on personal finance. It is imperative to pay attention to how your partner is managing their money BEFORE you ever consider marriage to get ahead of this potential stress that’s coming. 

Reason #5: The definition of job security is changing

The 9 to 5 job culture is dead - or probably in the ICU. 

In case you are wondering what we are talking about - there are over 75 million freelancers in the U.S., which is about 45% of the workforce! 

While the gig economy provides excellent flexibility - you can work while sipping coconut water in the Bahamas - it comes without those typical perks like insurance or social security benefits. 

As the definition of job security is changing–or frankly fading away–knowing how to get ahead of this trend and planning for the unexpected is probably more important now than ever. 

We live in a time when personal finance is probably the most important subject that every young adult should study. However, the traditional schooling system is ill-equipped to do that. This is why smart financial education platforms like uThrive Academy have jumped in to fill the gap. Our 6-module course on practical financial strategies can help you avoid financial stress and get control over your finances. 

Check out the course below!