Already low, financial literacy in America is declining, with many unable to understand concepts such as inflation or compound interest.
This is according to a report on Sunday (November 20) from the Financial Times, which cites research from FINRA, the Financial Industry Regulatory Authority. In 2009, the report says, the average respondent to FINRA’s financial literacy survey could answer three out of five questions.
Last year, the number fell to 2.6 questions, and just 4% of respondents could get the right answer to all five questions.
These numbers have real-life implications as consumers face record inflation, forcing them to stretch their dollars and struggle to rework household budgets.
Speaking to PYMNTS’ Karen Webster earlier this month, Banyan CMO Andrea Gilman and Copper CEO Eddie Behringer said financial institutions (FIs) and FinTechs could turn item-level data into new customer engagement opportunities as offerings align with spending. they The same information can help families manage their cash flow more effectively.
This is especially useful for members of Generation Z, who – along with their parents – see value in payment tools that can help them manage their expenses and develop financial literacy.
“This is really the first generation that has been hyper-accorded with the missteps of past generations,” Behringer said in an October conversation with Webster who reflected on the spending habits of the past. “[They think] it’s cool to be smart about money,” he added.
FinTechs like Copper — which provides parent-supervised banking services to younger consumers like personalized debit — are also “data ready,” Behringer said, and look to use receipt-level information to guide families in financial life. which is more healthy. Marketers would also do well, Copper told Webster, to leverage item-level information to provide targeted, personalized offers to these younger consumers, whether they’re shopping online or online.
Teens, and Generation Z, Behringer said, “vote with their dollars. They have an awareness and an affinity for the brands they buy from and the products they buy.”