I recently joined the board of my Manhattan co-op, and I love it. One of my duties is reviewing applications for apartments, which — as both a prospective neighbor and a retirement economist — has been a revelation.

It turns out, based on not only my limited sample but also more rigorous and representative surveys, a surprising number of people have no idea what they are doing when it comes to their finances. It’s not just the young folks with their DoorDash addictions. This is a multi-generational problem that spans income and wealth groups, and it’s getting worse.

To some extent, financial illiteracy is nothing new. For decades, most people have been unable to answer basic questions about investing, and many people don’t save enough. Yet somehow they have managed to muddle through. Measures of financial well-being have been fairly stable, and people in retirement say they are content with their lifestyle.

But that could change. The financial environment is much more complex now, and it is much easier to make bad decisions. People can use their phones to make bets with their credit card, day-trade on an app, or have frozen yogurt delivered to their door. Unsurprisingly, household debt levels have never been higher.

They’re also getting worse with money. The TIAA Institute conducts an annual survey about financial literacy, and over the last 10 years has observed a decline in the ability to answer basic questions about investing, retirement planning, risk-taking, budgeting and financial products.

In the most recent poll, Generation Z scored the lowest; almost half could answer only two or fewer questions about personal finance. This is despite the push in recent years to bring financial literacy classes to more high schools and the move in many states to make financial literacy education mandatory. Younger generations are also more likely to seek out advice from AI or influencers.

It could be that a lot of this training and advice is not very good. Financial literacy programs are often basic or out-of-date. Or they miss important lessons — as Matt Levine points out, they might cover compound interest but not explain why some assets (the risky ones) have a higher return than others. And while AI bots don’t give terrible advice, their sycophantic nature can lead to some bad guidance; one gave me a long rationalization for why I should go into debt to buy a designer handbag. (It told me it can be a good investment.)

And then there are the larger forces in the economy. People have to manage more inflation risk, and the job market faces huge structural challenges. Meanwhile, diversifying a portfolio has become harder as markets have become more concentrated.

The booming stock market may also have led too many investors to ignore the possibility of downside risk. The S&P 500 is up more than 500% since 2010 — more for anyone in high-beta assets, like crypto, which seem to offer endless wealth. All this wealth can create a false sense of security. A person who believes markets and GDP will keep rising probably also lives in a world where there are no budget constraints or trade-offs. Why not spend $15 to get a cup of frozen yogurt delivered to your door?

If the market continues to rise for the next 50 years, maybe things will be fine. But that’s a big gamble. The purpose of financial literacy is to teach people not only how to save for retirement, but also how to manage risks throughout their careers so they are prepared for a turn in the market or a bad economy.

It is to show them how to tell the difference between taking on good debt (to pay for a medical degree) or bad (to buy a handbag). Maybe it can also explain why some economic policies that so many people now support — rent control, say, or indifference to the national debt — have long been considered foolish, or worse.

What would better financial education look like? It should be more rigorous, for one, and updated to include lessons about influencers and AI. And it shouldn’t be afraid of laying out the consequences: If there is a severe market downturn or a recession, the weaknesses of risky investments or inadequate savings will be laid bare. Not to mention the impact they would have on an application to a Manhattan co-op.

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This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Allison Schrager is a Bloomberg Opinion columnist covering economics. A senior fellow at the Manhattan Institute, she is author of “An Economist Walks Into a Brothel: And Other Unexpected Places to Understand Risk.”

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