What’s a 401(k)? Two-fifths of Americans admit they don’t know

investmentnews.com:

A recent study highlights a significant gap in financial understanding among Americans, with nearly 43 percent of participants admitting they’re not clear about what a 401(k) retirement plan is.

The survey, which was conducted by OnePoll on behalf of Beyond Finance, polled 2,000 US residents balanced across generations to gauge the country’s financial literacy and readiness to adopt sound financial habits.

Thirty-nine percent of respondents believe they are more financially literate than the average person. Confidence in personal finance knowledge is notably low, with just 30 percent believing they could win in a trivia game focused on financial topics, and 35 percent confessing they don’t know the term “interest” as it applies to personal finance.

The study also uncovered a hesitation to engage with personal finances, with roughly 40 percent of those surveyed saying they put off taking steps toward healthier financial habits.

Among generations, Gen Z members show the most willingness to improve their financial behaviors, whereas millennials appear least likely to make positive changes. One-quarter of all respondents said they procrastinate on personal finance tasks because of stress, while 16 percent said they feel financially hopeless, believing their situation can’t get any worse.

“Some people tend to neglect taking stock of their financial situation, and others can become nervously consumed by it,” Erika Rasure, chief financial wellness advisor of Beyond Finance, said in a statement.

Despite these challenges, 80 percent of people in the poll said they try to set a monthly budget. Millennials and baby boomers were the most conscientious, with 81 percent from each group saying they create spending plans.

However,