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The importance of financial literacy
Improving financial literacy is key to helping Australians reach financial goals and achieve a more comfortable future, a financial institution has said.
The importance of financial literacy
Improving financial literacy is key to helping Australians reach financial goals and achieve a more comfortable future, a financial institution has said.
According to AMP, while financial literacy is no silver bullet, good financial literacy is associated with being more willing to address financial issues and getting finances in order.
This leads to better outcomes for consumers who are more actively engaged with their finances.
AMP’s chief client officer, Ant Dureau, said it is negative feelings about people’s finances that are stopping them from attempting to improve or gain financial literacy.
“We don’t like people to see how disorganised we are and we’re not prepared to get help until our knowledge of money and our finances are at least presentable,” Mr Dureau explained.
He said the financial world is only becoming more complex, with consumers struggling to know how much super they need, how much can they borrow and what type of insurance they need.
AMP’s findings reflect the recent study by comparison site Compare the Market that showed Aussies are failing at financial literacy, with an average score of 48 out of 100.
It considered that “there has been a marginal drop across financial capability and willingness; however, the average Australian remains reasonably capable in basic financial literacy and pretty motivated with their finances”.
But “when it comes to being financially sophisticated, the average Australian has fallen further in 2019”.
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