Financial literacy – a key to improve the financial wellbeing
According to a recent OECD report, which covered 39 countries including various G20 and developing nations, the level of financial literacy among adults is alarmingly low. The report reveals that only 34 percent of adults in the participating countries meet the criteria to be considered financially literate. Additionally, it highlights that nearly one in six people have fallen victim to financial #fraud, indicating a lack of awareness and understanding in this area. Another startling revelation is that less than half of the respondents (41 percent) are aware that cryptocurrencies are not legal.
The OECD emphasizes that the ultimate goal of financial literacy policies and programs is to improve individual financial wellbeing. While measuring this benefit can be challenging, the research shows that when individuals surpass the passmark for financial literacy, there is typically a 10 percentage point increase in their financial wellbeing scores. On average, the financial literacy rate stands at 42 percent, with Germany emerging as a standout performer in both financial literacy and financial wellbeing. These findings underscore the importance of improving financial literacy worldwide to enhance individuals’ financial security and protect them from fraud.