The severe consequences of the current financial crisis have reaffirmed the great lag in financial knowledge. Apart from the change of economic conditions, there is also the demographic barrier, which poses a risk to every individual. Therefore, individuals need to understand financial information in order to be able to react adequately. However, research suggests that financial literacy is low on a global scale, showing concerning gaps between certain groups that may be attributable to financial insecurity and old-age poverty.
In light of these findings, an empirical snapshot of the level of financial literacy and retirement planning is given, observing 165 students and non-students, of German and non-German nationality, aged between 20 and 30. The findings suggest that the research findings still apply to the current status. With regard to the financial literacy test, we find that overall only less than half of all respondents were able to answer all three questions correctly. With regard to the groups, women score lower than men; students do better than non-students. In addition, we found that age and nationality are not of importance, while the professional background – at least in our sample - can lead to a better test score.
As a consequence, a female non-student working in/studying a nonbusiness/ economics-related field/discipline is most endangered. With regard to the savings behavior, we see differences among gender and academic backgrounds implying that male students save on average more often, putting female non-students at risk. We did not find a statistically significant link between the financial literacy test score and savings behavior in our sample.
Inhaltsverzeichnis (Table of Contents)
- I. INTRODUCTION
- II. BACKGROUND
- III. METHODOLOGY
- Questions included in survey
- Participants
- Measurement Errors
- IV. KEY FINDINGS
- Overall responses
- Methods
- Statistically proven findings within groups
- Age
- Gender
- Nationality
- Academic background
- Professional background
- V. RESULTS AND CONCLUSION
- AKNOWLEDGEMENT
- REFERENCES
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This study examines the level of financial literacy and retirement planning among individuals aged 20-30 in Germany. It aims to identify groups within this age range who have less financial knowledge and to investigate potential factors contributing to their financial literacy and savings behavior. The study also seeks to relate its findings to the current state of research in the field.
- Financial Literacy and Retirement Planning
- Demographic and Economic Changes Impacting Financial Security
- Factors Influencing Financial Literacy: Gender, Education, and Professional Background
- Savings Behavior and Retirement Planning
- Comparison of Research Findings to Existing Literature
Zusammenfassung der Kapitel (Chapter Summaries)
- I. INTRODUCTION: The chapter introduces the shift in pension schemes from defined benefit pensions to individual-account contribution schemes, particularly in Germany. It highlights the importance of private retirement planning due to demographic changes and the complexity of financial instruments in the current market. The introduction also emphasizes the significance of financial literacy in light of the current financial crisis and the global research indicating low levels of financial knowledge across various countries.
- II. BACKGROUND: This chapter delves into existing research on financial literacy, highlighting variations among different demographics. It discusses the inverted u-shaped pattern of financial literacy across age groups, with lower levels observed for young and older individuals. It also examines the gender gap in financial literacy, particularly in Germany, where women score lower than men. Additionally, the chapter explores the impact of education, labor market status, and other factors on financial literacy.
- III. METHODOLOGY: This chapter describes the research methodology, focusing on the survey questions used to assess financial literacy. It explains the design and purpose of the questions, including their simplicity, relevance, brevity, and ability to differentiate between knowledge levels. The chapter outlines the participant pool, sampling methods, and potential measurement errors.
- IV. KEY FINDINGS: This chapter presents the results of the survey, analyzing responses to individual questions regarding financial literacy and retirement planning. It discusses the overall response patterns and identifies statistically significant findings for various demographic groups, including age, gender, nationality, academic background, and professional background.
Schlüsselwörter (Keywords)
The study focuses on the relationship between financial literacy, retirement planning, and demographic characteristics. Key terms include financial literacy, retirement planning, Germany, gender, education, and professional background. It also examines the impact of demographic factors, economic changes, and financial instruments on individual financial decision-making.
- Arbeit zitieren
- M.Sc. Angelina Scholtysik (geb. Haniecka) (Autor:in), 2014, "Do you save for your retirement?" An empirical snapshot of the level of financial literacy and retirement planning, München, GRIN Verlag, https://www.hausarbeiten.de/document/442349
