Global: Older Americans Demonstrate Stronger Digital Financial Literacy Compared to Younger Counterparts

Older Americans Demonstrate Stronger Digital Financial Literacy Compared to Younger Counterparts
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Recent research conducted by Capital One reveals a notable trend: digital financial literacy among Americans tends to increase with age.

Based on a survey of 3,000 adults, nearly 86% of Americans demonstrate knowledge of how to safeguard their personal information online. However, the study also highlights a concerning statistic – over 40% of consumers lack fundamental financial knowledge, such as debt management and credit building strategies.

According to Capital One’s definition, only 55% of individuals can be considered digitally financially literate. These individuals possess a blend of basic financial acumen and the ability to protect themselves online from common threats like phishing attacks and scams.

Interestingly, older respondents exhibit higher levels of proficiency in both digital and financial literacy. Among individuals aged 65 and above, a remarkable 74% demonstrate strong competencies in both areas, contrasting with just 28% of the 18-24 age group.

Even among those who score low on both digital and financial literacy metrics, a significant portion – 45% – express a preference for managing their finances through mobile apps, with 19% favoring websites, and a mere nine per cent opting for traditional bank branches.

Moreover, the study underscores the widespread adoption of digital banking in the United States, with 70% of households reporting enrollment in digital banking for some or all of their accounts. Among enrolled consumers, a staggering 95% indicate that they engage in online banking activities either frequently or occasionally.

Shena Ashley, President of the Capital One Insights Centre, emphasizes the pivotal role of digital platforms in modern banking: “Banking is increasingly digital – from bill payments to account monitoring, individuals are leveraging online tools to manage their finances. Consequently, digital financial literacy skills have become indispensable for consumers.”

Ashley further notes, “Despite the widespread adoption of online banking, a significant portion of the population still lacks essential financial knowledge and skills, highlighting the need for ongoing education and support in this area.”

This study sheds light on the evolving landscape of financial literacy and underscores the importance of equipping individuals with the necessary skills to navigate the digital realm effectively while making informed financial decisions.

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