Exactly What do Australian 15-year olds share with their peers in New Zealand and Estonia?
Well, inning accordance with the Program for International Trainee Evaluation (PISA) report, Australian, Kiwi and Estonian teens rank third-equal in the world for their financial literacy skills.
The PISA research study, an initiative of the Organisation for Economic Co-operation and Development (OECD), discovered just 15-year olds from the Flemish-speaking areas of Belgium and their counterparts in Shanghai comprehended financing much better than Australian youngsters.
While this is an encouraging outcome it is necessary not to check out excessive into it. In the first place, PISA surveyed only 18 countries for financial literacy.
And second of all we had to share third-place honours with the Kiwis (Estonia we can cope with), which reveals that Australia has considerable space for improvement in monetary literacy.
This has been identified by a broad series of stakeholders, consisting of the Australian Securities and Investments Commission (ASIC), which is coordinating a nationwide push to enhance monetary literacy across the board.
In its just-published ‘National Financial Literacy Strategy’, ASIC lays out an in-depth strategy encompassing school curriculum, totally free info services, guidance programs, industry partnerships and ongoing research.
ASIC defines monetary literacy as “a combination of monetary understanding, abilities, attitudes and behaviours necessary to make sound monetary choices, based upon individual circumstances, to enhance monetary wellbeing”.
” In today’s fast-paced consumer society, monetary literacy is an important daily life skill. It implies being able to comprehend and work out the financial landscape, handle loan and monetary threats effectively and avoid financial risks,” ASIC says. “Improving financial literacy can benefit anyone, despite age, earnings or background.”
I totally support the effort to raise the level of Australians’ financial literacy. As a monetary consultant I get to see first-hand the, sometimes large, holes in monetary knowledge in the Australian neighborhood.
Skeptics might argue that the monetary literacy space actually matches the advisory market. From my viewpoint, the much better the grounding our clients have in monetary principles, the more efficient and efficient the advisory relationship.
With a financially-literate population, consultants can cut straight to the real issues instead of training financing 101.
Our money-smart 15-year olds augur well for the future. (Incidentally, while PISA deemed it as “not substantially various”, Australia had a mean rating of 526 in the finance test compared to 520 for NZ, which we can take as a win.).