FINRA Foundation Releases Sixth Wave of the National Financial Capability Study

Findings Reveal Decline in U.S. Adults’ Ability to Make Ends Meet and Save for Emergencies, More Households Strained by Increased Costs, and the Struggle of the Middle-Income Group

Also, 20% of U.S. Adults Interested in Getting Financial Advice from Artificial Intelligence

WASHINGTON—The FINRA Investor Education Foundation (FINRA Foundation) released today its sixth wave of the National Financial Capability Study, an expansive source of data and insights about the financial lives of U.S. adults that has been conducted every three years since 2009.

Following a 12-year period of sustained improvements in many of the key areas of financial capability included in the National Financial Capability Study—from the Great Recession of 2009 through the COVID-19 pandemic—the latest findings reveal an overall pattern of decline in U.S. adults’ ability to make ends meet and save for emergencies. While the comprehensive study shows no signs of overall declines in income, the findings show that increased costs have put more households under strain than in previous waves of the study.

The findings also indicate what can be described as a “struggle of the middle.” In many of the demographic breakdowns on measures of financial capability, the middle groups (those with annual household incomes between $25,000 and $75,000, those with some college education but no degree, and those between the ages of 35 and 54) appear to share many of the struggles of those in lower income households, without any college experience and younger cohorts. This is especially apparent in measures of difficulty making ends meet, the impact of higher food costs, setting aside emergency funds and engaging in expensive credit card practices.

“The 2024 National Financial Capability Study reveals a concerning shift in Americans' financial resilience. After more than a decade of improvements, we're seeing many households—particularly in middle-income brackets—struggling financially despite stable incomes. This 'struggle of the middle' signals that rising costs are creating financial strain across a broader segment of the population,” said Gerri Walsh, President of the FINRA Foundation.

“The FINRA Foundation’s National Financial Capability Study serves as an important barometer of Americans' financial health. By tracking trends over time and exploring the nuances of financial behaviors and attitudes, this study identifies areas where more support and education can create positive impact,” said Jonathan Sokobin, FINRA Foundation Board Chair and Chief Economist at FINRA. “This study is a vital resource that policymakers, researchers, educators, firms and financial professionals can use to better understand and address the financial capability needs of Americans.”

The National Financial Capability Study focuses on four components of financial capability:

• Making Ends Meet. In contrast to the generally positive trends seen from 2009 through 2021, the 2024 data show substantial declines in many of the key measures of making ends meet. More U.S. adults report that they are spending more than their income, and fewer say they are satisfied with their overall financial condition. Two-thirds say that increased food costs have caused them to cut back on other spending. The sub-topics covered include:
  • Covering expenses
  • Feelings about personal financial condition
  • Financial fragility
  • Income shocks and income volatility
  • Informal work activities
  • Intergenerational wealth transfer
  • Behavioral signs of financial stress
  • Medical expenses
  • Effects of inflation
  • Severe weather and finances
     
• Planning Ahead. The percentage of U.S. adults who say they have set aside enough money to cover three months’ worth of living expenses in case of an emergency dropped to 46 percent from 53 percent in 2021. The percentage saving for retirement varies greatly by education level: 80 percent of college graduates have a retirement account, in contrast to 37 percent of those with no college experience. In response to a new question, 20 percent of adults say they would be interested in getting financial advice from artificial intelligence. The sub-topics covered include:
  • Rainy day funds
  • Planning for retirement
  • Saving for college
  • Investing
  • Risk preferences
  • Financial self-efficacy
  • Personal finance technology
  • Artificial intelligence
     
• Managing Financial Products. Eighty-one percent of U.S. adults use their mobile devices to access their checking or savings accounts, and over half use mobile devices to make in-person purchases (53 percent) and to transfer money to other people (65 percent). The percentage of respondents saying they always pay their credit cards in full each month (53 percent) has decreased by six percentage points relative to 2021, ending the steady increase seen over the previous five waves of the National Financial Capability Study. Twenty-three percent say they have used Buy Now Pay Later services in the last 12 months. The sub-topics covered include:
  • Banking and payment methods
  • Home ownership and mortgages
  • Credit cards
  • Student loans
  • Non-bank borrowing
  • Buy Now, Pay Later
  • Overall debt
  • Credit scores
     

• Financial Knowledge. The percentage of respondents correctly answering at least four of five financial knowledge quiz questions has held steady since 2021. Men are more likely than women to answer the quiz questions correctly, though the gap appears to be closing with successive generations. The proportion of respondents who answer the inflation question correctly has increased by five percentage points relative to 2021, with the performance of those aged 18 to 34 improving by ten percentage points. The sub-topics covered include:

  • Financial literacy
  • Self-perceptions of financial knowledge and ability
  • Financial education
     

  Related Information: In April, the FINRA Foundation previewed the state-by-state findings for financial knowledge and inflation from the National Financial Capability Study.

NOTE: The FINRA Foundation will hold a virtual press conference about the sixth wave of the National Financial Capability Study at 11 a.m. E.T. today. Unauthorized use of the press conference video or audio is not allowed.

Please reach out to [email protected] by 10:45 a.m. to register.

About the National Financial Capability Study

In 2009, the FINRA Investor Education Foundation launched the first national study of financial capability of adults in the United States. Since its start, the National Financial Capability Study has provided data on multiple indicators of capability—including financial behaviors, attitudes and knowledge.

National Financial Capability Study survey data is collected every three years. The 2024 survey, conducted from June through October, represents the sixth wave of data. Each wave of the study has data from more than 25,500 U.S. adults across all 50 states and Washington D.C. (500 per state/D.C.), and findings can be reported at both the state and national level. The sixth wave has been updated to include new questions on timely topics, including inflation, artificial intelligence and Buy Now, Pay Later, borrowing, among other topics. This extensive body of data is available for free to the public and researchers.

More information about the FINRA Foundation’s National Financial Capability Study, including reports and data from previous waves of the study and interactive data visualizations, can be found here.

About the FINRA Investor Education Foundation

The FINRA Investor Education Foundation supports innovative research and educational projects that empower Americans with the knowledge, skills and tools to make sound financial decisions throughout their lives. For more information about FINRA Foundation research and education initiatives, visit finrafoundation.org.

About FINRA

FINRA is a not-for-profit organization dedicated to investor protection and market integrity. FINRA regulates one critical part of the securities industry—member brokerage firms doing business in the U.S. FINRA, overseen by the SEC, writes rules, examines for and enforces compliance with FINRA rules and federal securities laws, registers broker-dealer personnel and offers them education and training, and informs the investing public. In addition, FINRA provides surveillance and other regulatory services for equities and options markets, as well as trade reporting and other industry utilities. FINRA also administers a dispute resolution forum for investors and brokerage firms and their registered employees. For more information, visit www.finra.org.