How to bridge the Gen Z financial literacy gap

Kyla Scanlon, author of “In This Economy?,” joins TheStreet to explain how we can bridge the financial literacy gap for Gen Z-ers.

Transcript

00:00What are some key areas where you think people need more education and more awareness when it

00:06comes to their finances? I really think it is dealing with interest rates. I used to sell cars

00:14and I think that there's sometimes a little bit of confusion around, you know, what is financing

00:20a car actually look like and like what is an 84-month payment actually costing me. So I would

00:27say like that's a big thing. Auto is a huge part of people's budget and oftentimes, you know,

00:33having such extended payments can be very painful for people as well. I think the second thing is

00:40housing. You know, mortgages are great but then you have all these other things that oftentimes

00:46come as a surprise, I think, to homeowners when you're buying a home like property taxes,

00:50insurance, etc. And so I'd say those two things which are kind of like the core part

00:55of an economic experience, which is buying a car and buying a house, there could always be

01:00more education around. It's not people's fault that they don't know it. It's not something that

01:04we're necessarily taught in school, but it's super important to understand. And what about

01:10the generational differences? A recent survey showed that Gen Z lacks financial confidence.

01:16How can we bridge, how can this gap be bridged? Sure, yeah. I think that the lack of financial

01:25confidence probably comes from student loan debt. You know, you're 18 years old and you're signing a

01:30huge loan for, you know, $100,000 or such. And so I think that that can maybe be addressed,

01:37like actually walking people through what student loan debt is, what impact that it can have. It

01:42would be a great first step. I'm a big advocate of policy, like public policy. I think that

01:48setting people up with some sort of stock market account, I would love to see a return to baby

01:53bonds. I just think that like having a financial foundation, to use that word again, would help

01:59reduce some of this financial uncertainty that we see. I think a lot of people are just worried

02:04about the lack of safety net because if something happens, like, you know, where do you go? What

02:09do you do? And so I just think that the more that we can help people sort of establish a

02:13financial foundation, the less uncertainty that we could see.