Only 33% of adults worldwide have basic financial literacy
In 2015, S&P Ratings, Gallup and the World Bank carried out the largest financial literacy study ever: 150,000 adults interviewed in 148 countries. The conclusion was blunt: only 1 in 3 adults worldwide understands basic financial concepts such as compound interest, inflation or risk diversification.
How it was measured: the S&P Global Financial Literacy Survey method
The study assessed adults in 148 countries using four questions covering the financial concepts that matter most for everyday decisions. To count as "financially literate", a respondent had to answer at least three of the four correctly.
The four areas: risk diversification, inflation, simple interest and compound interest. The global result: 67% of adults got at least two of those four questions wrong.
A gap that early education can close if it is designed to reach everyone equally.
The concrete cost of low financial literacy
Low financial literacy has measurable economic consequences: excessive consumer debt with high-cost loans, vulnerability to financial fraud, and too little saving for retirement.
Relying almost entirely on public pensions is a systemic risk that early financial education can help reduce.
Why school is the most effective place to step in
Financial education programmes for adults have limited impact. Financial habits that have been in place for years are hard to change.
Habits also form early: a University of Cambridge review for the Money Advice Service (Whitebread and Bingham, 2013) concluded that habits such as planning ahead and being able to wait start forming in childhood. School is where those habits can turn into sound decisions before the first real ones arrive.
Finomik brings these skills into the classroom before students make their first financial decisions. We can start a pilot at your school in less than a week.
Book a demo