Bridging the financial literacy gap for Gen Z

Most college students today face a financial blind spot as they head into adulthood. They graduate with degrees, internships, and mountains of student debt—but little knowledge about managing their money effectively. Shocking: Only 35% of college students can correctly answer 4 out of 5 basic financial literacy questions, according to TIAA Institute. This isn’t just concerning; it’s setting up an entire generation for financial missteps that could take years to recover from.

The reality is students want to learn about personal finance, but the tools and education available to them are outdated or irrelevant. As a result, they make avoidable mistakes—misusing credit cards, misunderstanding loan repayment plans, or failing to budget properly. With 65% of college students worrying about having enough money to pay for school, and 43% of student loan borrowers not making payments, the need for financial education couldn’t be more urgent.

Technology can help 

Artificial intelligence tools have become commonplace in many work settings, yet this technological wave has yet to sweep through education. We are starting to see improvement, however.

AI-driven tools and gamified platforms are popping up, reshaping how students engage with personal finance. Some tools offer real-time insights into spending, provide tips on saving, and help students see the bigger picture of where their money goes.

However, most of these technologies aren’t tailored for college students. They often miss the unique challenges students face—managing financial aid, working part-time jobs, and living on tight budgets. We need tools that don’t just track money but educate students on navigating their specific financial landscape.

Building credit responsibly

When it comes to building credit, the stakes are even higher. Too many students graduate with little to no credit history or, worse, have already made credit mistakes. The solution isn’t to avoid credit altogether but to introduce smarter, safer alternatives. Tech-driven financial products can offer students ways to build credit responsibly:

• Debit-style credit cards that limit spending
• Platforms that offer credit for paying rent or bills on time
• AI-powered money management and credit monitoring

Statistics show that students with higher financial literacy are 30% less likely to use high-cost borrowing methods like payday loans. This knowledge translates to real-world benefits: financially literate college graduates earn 40% more over their lifetimes compared to those with low financial literacy.

Beyond just technology

While technology plays a crucial role in addressing the financial literacy gap, it’s only part of the solution. With financial stress being the #1 reason why students drop out of college, financial education needs to be woven into the fabric of student life, becoming something students actively engage with throughout their college years. The responsibility lies not only with tech platforms but with academic institutions themselves. Here’s how we can go further:

Integrating Financial Literacy into Academic Programs

It’s not enough to rely on apps and tools—students need structured, formal education on managing their finances. Every student, regardless of major, should have the opportunity to gain a solid foundation in personal finance. Alongside orientation, students could take a 1-credit financial literacy course in their first year. This course would cover the basics—budgeting, loans, credit scores—but also delve into more complex topics like investing and long-term financial planning.

For students who want to dive deeper, they can enroll in a “Financial Wellness” certificate program. This would provide an in-depth education on personal finance, with the flexibility to tailor learning to their own future goals—whether they plan to go into high-earning professions or are more focused on paying off debt as efficiently as possible and starting the journey to investing.

Leveraging Campus Resources

Incorporating financial literacy into campus life means tapping into the resources students already rely on, like student affairs, financial aid and career services. Financial aid offices could offer workshops on managing loans effectively, helping students understand repayment plans, interest rates, and how to avoid defaulting on loans. Career services could host sessions on salary negotiation, understanding job benefits, and building long-term financial stability after graduation. It’s not just about getting a job—it’s about knowing how to make the most of that first paycheck, knowing which benefits to prioritize, and understanding how to start saving and investing for the future.

Measuring Outcomes for Real Impact

But how do we know if these initiatives are working? It’s essential to measure not just participation, but actual results. Schools can track how much students are learning by conducting pre- and post-program assessments. Metrics like student loan default rates, credit scores, and even post-graduation financial stability could give us a clearer picture of the long-term impact of financial literacy programs. And schools shouldn’t stop once students graduate—following up a few years down the line to see how these lessons have impacted their financial health can help refine and improve future programs.