Flore-Anne Messy is Head of the Financial Affairs Division, Directorate for Financial and Enterprise Affairs, OECD, and Executive Secretary of the OECD/INFE. She presented the results of the OECD/INFE International Survey of Adult Financial Literacy Competencies to the NZ OECD Global Symposium on Financial Education 2016 in Auckland.

1. TODAY VS TOMORROW?
WHAT INTERNATIONAL EVIDENCE SAYS:
FIRST RESULTS OF THE OECD/INFE INTERNATIONAL
SURVEY OF ADULT FINANCIAL LITERACY COMPETENCIES
Auckland, 12 October 2016
Flore-Anne Messy
Head of DAF/FIN Division, OECD
Executive Secretary INFE

2. Outline

3. THE OECD/INFE
SURVEY INSTRUMENT

4. Survey instrument to capture
financial literacy…
• …a combination of awareness,
knowledge, skill, attitude and
behaviour necessary to make
sound financial decisions and
ultimately achieve individual
financial well-being
…in a representative sample of
adults, and available in a Toolkit
• Questionnaire (core) and optional
questions
• Methodological notes; Interviewer
briefings
G20 Leaders welcomed and
supported its use in 2013
It was updated in 2015
to include new areas
OECD / INFE survey to measure financial literacy and
financial inclusion

5. Results comparable across countries and over time
OECD/INFE financial literacy survey
…as well as on its relationship with
Fin Behaviour
9Q
Budgeting, paying
bills on time, active
saving, choosing
products, retirement
planning
Fin knowledge
7Q
Simple and compound
interest, Inflation, time
value of money, Risk and
return, Risk
diversification
Fin attitudes
5Q
Propensity to
save vs spend,
Time
preference
Financial inclusion
Financial products
awareness, use and
recent choice
Socio-demographics
Age, Gender,
Education, Work,
Income
New areas
Wellbeing; Fraud;
Self-assessment of
financial knowledge

6. THE 2015
INTERNATIONAL
SURVEY RESULTS:
SELECTED FINDINGS

7. 30 countries and
economies
(including 17 OECD
countries) took part.
In total, 51,650
adults aged 18 to
79 were interviewed
using the same core
questions, in a total
of 30 languages.
Analysis looks at :
• Responses to
different questions
• Minimum target
scores achieved
in financial
knowledge,
behaviour and
attitudes
In brief

8. Albania Jordan
Austria Korea
Belarus Latvia
Belgium Lithuania
Brazil Malaysia
British Virgin Islands Netherlands
Canada New Zealand
Croatia Norway
Czech Republic Poland
Estonia Portugal
Finland Russian Federation
France South Africa
Georgia Thailand
Hong Kong, China Turkey
Hungary UK
International coverage:
30 countries across Asia Pacific,
Europe, Africa, North and South America

9. On average, just 56% of adults across participating countries and
economies achieved the minimum target score of at least 5 out of 7
(63% across OECD countries)
Many adults are currently unable to reach the minimum target score on
financial knowledge
56%
62%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
SouthAfrica
Malaysia
BritishVirginIslands
Belarus
Thailand
Albania
RussianFederation
Croatia
Jordan
UnitedKingdom
Brazil
CzechRepublic
Poland
Georgia
Average,allcountries
Turkey
France
Hungary
Belgium
Lithuania
Portugal
Canada
Average,OECDcountries
NewZealand
Netherlands
Austria
Latvia
Norway
Finland
Estonia
Korea
HongKong(China)

10. On average, only 58% could calculate
a simple interest on savings (65%
OECD)
On average, only 42% of adults
are aware of the additional
benefits of interest compounding
on savings (48% OECD)
Only about two in three adults were
aware that it is possible to reduce
investment risk by buying a range of
different stocks
Adults particularly struggle with
basic financial knowledge and concepts

11. The distribution of knowledge varies
0%
10%
20%
30%
40%
Korea
Latvia
Lithuania
Malaysia
Netherlands
NewZealand
Norway
Poland
0 1 2 3 4 5 6 7

12. And women struggle with financial knowledge more
than men, on average, and in many countries
(percentage of women and men achieving target minimum score)
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
SouthAfrica
BVI
Jordan
UnitedKingdom
Brazil
Canada
Georgia
Ave,allcountries
Turkey
Netherlands
NewZealand
Belgium
Lithuania
France
Portugal
Norway
Ave,OECDcountries
Austria
Finland
Korea
HongKong(China)
Female Male
Only statistically significant differences shown

13. Just one in two (51%) respondents across all participating countries
and economies achieved the minimum target score of at least six out of
nine on financial behavior (54% OECD)
Only about half of adults reach
the minimum target score on behaviour
51%
54%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90% Hungary
Poland
Georgia
Brazil
Turkey
Estonia
Croatia
CzechRepublic
Belarus
RussianFederation
Albania
Netherlands
Latvia
Lithuania
Average,allcountries
Average,OECD…
UnitedKingdom
Malaysia
Korea
Norway
Jordan
NewZealand
Thailand
HongKong(China)
Portugal
Canada
Austria
Belgium
Finland
BritishVirginIslands
France

14. The weakest areas of financial behaviour across these
measures appear to be related to budgeting, planning ahead,
choosing products and using independent advice
There are several beneficial behaviours that are (perhaps surprisingly)
uncommon
On average, only 60% of adults
reported having a household budget
(57% OECD); and only about 50% set
long-term goals and tried to achieve
them (51% OECD)
Among those who had chosen a
financial product in the last two years,
only 44% made an attempt to shop
around on average (46% OECD), and
only 19% used independent
information (20% OECD)

15. 60% 57%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Latvia
Malaysia
France
Turkey
Belarus
Korea
Thailand
Portugal
Albania
Croatia
Poland
Lithuania
Jordan
Georgia
Canada
Finland
HongKong(China)
SouthAfrica
Average,allcountries
NewZealand
Average,OECDcountries
UnitedKingdom
RussianFederation
BritishVirginIslands
Belgium
Brazil
Estonia
CzechRepublic
Netherlands
Norway
Austria
Hungary
In a number of countries, less than half of
respondents have a household budget

16. 1in 5 borrowed to make ends meet in the
last 12 months, on average
0%
10%
20%
30%
40%
50%
60%
70%
Belgium
UnitedKingdom
Norway
HongKong(China)
Hungary
NewZealand
Austria
Korea
France
CzechRepublic
Poland
Netherlands
Canada
Finland
Average,OECD…
Portugal
Estonia
Brazil
Jordan
Average,allcountries
Croatia
Malaysia
Lithuania
BritishVirginIslands
RussianFederation
Latvia
SouthAfrica
Albania
Belarus
Turkey
Georgia
Thailand
Respondent reported that their income did not always cover their living costs
Respondent borrowed to make ends meet (% of all respondents)

17. When people choose a financial product they
(very) rarely seek independent advice
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Netherlands
Hungary
HongKong(China)
CzechRepublic
Belarus
Croatia
UnitedKingdom
Belgium
Poland
NewZealand
Estonia
Jordan
Lithuania
RussianFederation
Latvia
Average,allcountries
Norway
Average,OECDcountries
Albania
Turkey
Brazil
Georgia
Malaysia
Canada
Austria
Thailand
Finland
France
Portugal
BritishVirginIslands
Korea
1 Some attempt to make informed decision or sought…
2 Used independent information or advice

18. Combining these findings,
levels of financial literacy are low
13.2 out of 21, on average on the minimum target score
0.0
5.0
10.0
15.0
20.0
Poland(11.6)
Belarus(11.7)
Croatia(12.0)
Brazil(12.1)
RussianFederation(12.2)
Malaysia(12.3)
Georgia(12.4)
Hungary(12.4)
Turkey(12.5)
CzechRepublic(12.6)
Jordan(12.6)
Albania(12.7)
Thailand(12.8)
BritishVirginIslands(13.0)
UnitedKingdom(13.1)
Average,allcountries(13.2)
Latvia(13.3)
Estonia(13.4)
Netherlands(13.4)
Lithuania(13.5)
Average,OECDcountries(13.7)
Portugal(14.0)
Austria(14.2)
Belgium(14.3)
Korea(14.4)
NewZealand(14.4)
HongKong,China(14.4)
Canada(14.6)
Norway(14.6)
Finland(14.8)
France(14.9)
Knowledge score Behaviour score Attitude score

19. SELECTED POLICY
LESSONS

20. Importance of starting financial education early
and ideally in schools
• improve financial knowledge overall
• establish sound habits (budget /long term planning)
• bridge the knowledge gender gaps
Selected financial education policy lessons (1):
Addressing overall low level of financial literacy

21. Support financial resilience
and improve active choices of products
• Tools to develop budget and face to face advice on prioritizing expenses
and saving
• Support planning ahead and saving through a mixture of improved
financial knowledge and tools (simulators) as well as nudges (reminders to
save and default option)
• Improve access to information on products (comparison) and to advice
especially in the case of complex investment choices (including for
retirement) – prospect of robo advice if properly regulated
Selected policy lessons (2) :
Address adults’ weakest behaviors

22. Role of financial regulation : especially in the
area of credit to support responsible use and
protect consumers; but also to promote saving
for the long-term (pension systems, taxation)
The economic and financial context :
The current low interest rate and inflation
environment coupled with increased
digitalization of finance may have an impact on
consumers’ attitude and behaviors towards the
short term and overreliance on credit.
Selected policy lessons (3):
The broader picture

23. NEXT STEPS

24. More detailed analysis of gender differences
Analysis of the potential correlation between
financial inclusion and financial literacy
Analysis of other target groups, such as the self-
employed, older adults, low-income groups
Exploration of the concept of
financial well-being
Report on financial literacy across G20 countries
Future analyses

25. THANK YOU!
KIA ORA
SecretariatINFE@oecd.org
www.financial-education.org