Using data from the first wave of the TIAA Institute-GFLEC Personal Finance Index, this report examines financial literacy among Hispanic adults in the United States.
The authors’ analysis shows that Hispanics’ personal finance knowledge is generally lower than that of the overall U.S. adult population. The difference is prevalent across all demographic groups, except for young (ages 18-34) U.S.-born Hispanics, whose financial literacy is close to that of young non-Hispanic whites. The report findings also show a notable difference in financial literacy within the Hispanic population, with higher levels among U.S.-born Hispanics compared to those born elsewhere. This within-group difference cannot be attributed to differences in underlying demographics, as the finding is consistent when accounting for age, education and income.
- U.S.-born Hispanics ages 18-34 have greater financial literacy than each age group of foreign-born Hispanics.
- Financial literacy programs that address U.S.-born and foreign-born Hispanics separately are likely to experience better results for both groups.
- Since growth in the U.S. Hispanic population is driven largely by births, the gap in financial literacy should decrease over time. Gains in education attainment among Hispanics will likely further decrease the gap.
- Given the modest levels of financial literacy in the general U.S. population, raising the overall level of financial literacy is paramount for sustaining the nation’s fiscal health.