Report: Millennials struggle with personal finance

Millennials don’t know much about personal finance, according to a new study from GW.

The Global Financial Literacy Excellence Center at GW partnered with PwC US, a global financial advisory company, to conduct a research study about members of the generation and how much they know about running their own finances. The study found that even with greater financial burdens from economic uncertainty and student debt, millennials know little about personal finance.

The study found that among roughly 5,500 people aged 23 to 35, only 24 percent demonstrated basic financial knowledge. The researchers used data from a 2012 study that examined the ability of Americans of all ages to plan and manage money.

“Millennials owe a lot. They know too little,” Annamaria Lusardi, the academic director of the Global Financial Literacy Excellence Center, said in the study’s report. “Millennials’ struggle with debt may eventually become our problem, too.”

The majority of those tested in the study failed to prove they understood complicated financial issues like basic asset pricing and inflation. The study also showed that many in the generation also have expensive credit card habits and are already dipping into their retirement accounts for extra money.

While this up-and-coming generation is better educated than those before, researchers said misunderstanding finances could jeopardize the economic security of young people, noting that about two-thirds of all millennials carry at least one source of long-term debt.

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