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Students’ financial literacy:
results from PISA 2015
December 2017
Rio de Janeiro
The PISA financial literacy test
• In 2015, around 48 000 students were assessed in financial literacy, representing about 12 million 15-year-olds in the schools of the 15 participating countries and economies
• Students in countries and economies that participated in the financial literacy answered – a two-hour combination of tasks in science, reading and mathematics
– A one-hour test in financial literacy (43 items) after the core assessment
– Questions about their experience with money such as discussing money matters with parents, basic financial products and sources of money (through a ‘money management questionnaire’)
… in addition to the standard questions about their personal background
Some 56% of 15-year-olds in participating OECD countries and economies have a bank account,
19% have a prepaid debit card
Young people are already financial consumers and will soon
encounter complex financial decision
Some 64% earn money from some type of work
activity
56%
64% But fewer than one in three students have the
skills to manage a bank account 31%
0 10 20 30 40 50 60 70 80 90
Peru Mexico
Brazil Chile
Lithuania Russian Federation
Slovak Republic China
Italy Belgium Poland Spain
Canada Netherlands
Australia United States
Made payments online using the Internet Made a transaction using a mobile phone
Many young people use digital financial products
Source: World Bank Global Findex, 2014
Percentage of young people age 15-24 who have:
%
Globalisation and digital technologies have made financial products
and services more widely accessible but also more challenging
• More challenging financial choices
– The spread of digital financial services opens up new opportunities for financially excluded people to access the formal financial system…
– but also exposes consumers to new security threats and risks of fraud that are compounded when low financial literacy is combined with poor digital skills and low cyber security awareness
• More financial risks
– Increased life expectancy, less welfare protection, more “individualized” pensions, and more uncertain economic and job prospects due to digitalization, technological change, globalization
• Growing inequality
Financial education is a complement
to financial consumer protection, inclusion and regulation
• More challenging financial choices
– The spread of digital financial services opens up new opportunities for financially excluded people to access the formal financial system…
– but also exposes consumers to new security threats and risks of fraud that are compounded when low financial literacy is combined with poor digital skills and low cyber security awareness
• More financial risks
– Increased life expectancy, less welfare protection, more “individualised” pensions, and more uncertain economic and job prospects due to digitalisation, technological change, globalisation
• Growing inequality
Financial literacy
Consumer protection and
regulation
Knowledge and understanding of financial concepts and risks…
…and the skills, motivation and confidence to apply such knowledge and understanding…
…in order to make effective decisions across a range of financial contexts, to improve the financial well-being of individuals and society, and to enable participation in economic life
Financial literacy in PISA
What does financial literacy mean for the lives of 15-year-olds?
• …if they go to the cinema, will they still have enough money for the bus fare home? Or would it be better to buy pizza and invite friends home?
Balance their priority and plan what to spend money on
• …a games console will need new games, a motorbike will need fuel, tyres and services
Remember that some of the purchases have ongoing costs
• …Some emails that look like they came from their bank might not be legitimate, they should know what to do if they are not sure
Being alert to possible fraud
• …If their phone gets stolen, they should ask their parents if it is covered by their household insurance
Knowing what risk is and what insurance is meant for
• …they should know that if they buy a computer on credit they will have to pay interest on the loan, on top of the advertised price for the compute
Make an informed decision about credit
PISA framework for financial literacy
Content
Money and transactions
Planning and managing finances
Risk and reward
Financial landscape
Processes
Identifying financial information
Analyse information in a financial context
Evaluate financial issues
Apply financial knowledge and understanding
Contexts
Education and work
Home and family
Individual
Societal
What the results tell us?
1. What are the current needs and gaps in financial literacy of students across countries and within countries?
2. What are the main factors explaining the wide inequalities within country?
3. Is financial literacy only about mathematics and reading ?
4. What are students’ current experiences with money matters ? Is it related to financial literacy?
5. How is financial literacy related to students’ financial behaviors and future expectations?
→ Goal : Evidence to support effective policy action
5 research questions and a policy goal
Students’ performance in financial literacy
What are the needs and gaps across and within countries?
B-S-J-G (China)
Belgium (Flemish) Canadian provinces
Russia Netherlands
Australia
United States Poland Italy
Spain
Lithuania Slovak Republic
Chile
Peru
Brazil
380
400
420
440
460
480
500
520
540
560
580 Mean performance in financial literacy
Mean financial
literacy score Figure IV.3.2
-30
-20
-10
0
10
20
30
Ru
ssia
Ital
y
Un
ited
Sta
tes
Bel
giu
m (
Flem
ish
)
OEC
D a
vera
ge-7
Spai
n
Slo
vak
Rep
ub
lic
Au
stra
lia
Po
lan
d
Three-year score-point difference
Change between 2012 and 2015
Figure IV.3.6
13 22 22 13
19 20 20 20 22 22 25
32 35 38
48
53
33 11 24 22 17 15 6 8
10 12 6 4
6 3
1 3
80
60
40
20
0
20
40
60
80
100
B-S
-J-G
(C
hin
a)
Russia
Belg
ium
(F
lem
ish)
Canadia
n p
rovin
ces
Neth
erlands
Austr
alia
Italy
Pola
nd
United S
tate
s
OE
CD
avera
ge-1
0
Spain
Lithuania
Slo
vak R
epublic
Chile
Peru
Bra
zil
Students’ financial literacy by proficiency levels
%
BANK ERROR - Evaluate a potential financial
fraud and respond appropriately to a financial
scam e-mail message – Level 5
INVOICE Question 2 - Identify a delivery cost that
is explicitly stated on an invoice – Level 2
INVOICE Question 1 – Recognise the purpose of
an invoice - Below Level 2
PAY SLIP - Read a pay slip and recognise that
the employer will only pay net salary into the
employee’s bank – Level 4
INVOICE Question 3 (partial credit) - Interpret
various elements on the same invoice to correct a
mistake in the billing – Level 3
Variation within each country is wider than the variation between
countries at the mean
Figure IV.4.1
Percentage of students at various percentiles on the financial literacy scale
200 300 400 500 600 700
B-S-J-G (China) 312 Belgium (Flemish) 291
Canadian provinces 295 Russia 232
Netherlands 312 Australia 309
OECD average-10 285 United States 280
Poland 262 Italy 249
Spain 265 Lithuania 266
Slovak Republic 311 Chile 274 Peru 276
Brazil 302
25th - 10th percentile 50th - 25th percentile 75th - 50th percentile 90th - 75th percentile
Score-point
difference between
90th and 10th
Varying opportunities to improve students’ financial literacy
What are the main factors (gender, socio-economic and immigrant background) explaining the wide inequalities within country?
-30 -25 -20 -15 -10
-5 0 5
10 15
Lithuania
Slo
vak R
epublic
Pola
nd
Austr
alia
Spain
Bra
zil
OE
CD
avera
ge
-10
Neth
erlands
Canadia
n p
rovin
ces
Peru
Russia
Belg
ium
(F
lem
ish)
United S
tate
s
Chile
B-S
-J-G
(C
hin
a)
Italy
Before accounting for performance in other subjects
After accounting for performance in mathematics and reading
In most countries/economies there are no differences in
financial literacy between boys and girls at the mean…
Figure IV.4.4 S
co
re-p
oin
t d
iffe
ren
ce
Girls perform better
Boys perform better
Gender differences in
financial literacy may be
related different
opportunities for learning,
different contexts in
which men and women
grow up and live, and to
a possible variation of
these factors across
generations.
Difference between boys and girls
0
10
20
30
40
50
60
Pe
ru
Bra
zil
Lith
ua
nia
Chile
Slo
va
k R
ep
ub
lic
Sp
ain
Ita
ly
Po
lan
d
Russia
Unite
d S
tate
s
OE
CD
ave
rag
e-1
0
Au
str
alia
Neth
erl
an
ds
Can
ad
ian
pro
vin
ce
s
Be
lgiu
m (
Fle
mis
h)
B-S
-J-G
(C
hin
a)
Boys
Girls
… but in 9 countries and economies out of 15, more boys than girls
are low performers
Figure IV.4.5
0
10
20
30
40
50
60
Boys
Girls
Stu
den
ts b
elo
w
Lev
el 2
Stu
den
ts a
t
Lev
el 5
%
%
300
350
400
450
500
550
600
650
Peru
117
Bra
zil
7
8
Chile
103
Slo
va
k R
ep
ub
lic
8
0
Lithuania
71
Spain
79
United S
tate
s
97
OE
CD
avera
ge
-10
89
Italy
60
Pola
nd
73
Austr
alia
107
Neth
erlands
104
Belg
ium
(F
lem
ish)
1
10
Russia
46
Canadia
n p
rovin
ces
77
B-S
-J-G
(C
hin
a)
1
32
Sco
re p
oin
ts
Top quarter of ESCS
Third quarter of ESCS
Second quarter of ESCS
Bottom quarter of ESCS
Difference
between
students in the
top quarter and
students in the
bottom quarter
of this index
Socio-economically advantaged students score 89 points higher
than disadvantaged students, on average across OECD,
equivalent to more than one PISA proficiency level
Table IV.4.11
Mean score, by quarters of the PISA index of economic, social and cultural status (ESCS)
Is financial literacy only about mathematics and reading?
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Russia 45
Brazil 47
Slovak Republic 48
Italy 52
Canadian provinces 53
Lithuania 58
Spain 58
OECD average-10 62
Poland 62
Chile 62
Peru 68
B-S-J-G (China) 69
United States 70
Belgium (Flemish) 70
Netherlands 71
Australia 71
Variation uniquely associated with mathematics performance Variation uniquely associated with reading performance Variation associated with more than one domain Variation uniquely captured by the financial literacy assessment
Total explained
variation
Student performance in financial literacy is correlated with performance
in mathematics and reading, but around 38% of the score reflects factors
that are uniquely captured by the financial literacy assessment
Table IV.3.10a
Financial literacy skills may go beyond or
fall short of the ability to use the knowledge that students acquired
in compulsory education
-40
-30
-20
-10
0
10
20
30
40
Lithuania
Spain
Slo
vak R
epublic
Pola
nd
Chile
Italy
OE
CD
avera
ge
-10
Neth
erlands
Bra
zil
Austr
alia
United S
tate
s
Peru
Canadia
n p
rovin
ces
Russia
Belg
ium
(F
lem
ish)
B-S
-J-G
(C
hin
a)
Sco
re-p
oin
t d
iffe
ren
ce
Students’ performance in
financial literacy is lower
than the performance of
students with similar scores
in mathematics and reading
Students’ performance in
financial literacy is higher
than the performance of
students with similar scores
in mathematics and reading
Figure IV.3.12
Difference between the actual financial literacy score and the score predicted by students’
performance in mathematics and reading
Highest performing countries/economies
Learning by doing
What are students’ current experiences with money matters ?
Are these related to financial literacy?
0
10
20
30
40
50
60
70
80
90
100
Neth
erlands
Austr
alia
Canadia
n p
rovin
ces
Belg
ium
(F
lem
ish)
OE
CD
avera
ge
-10
Italy
United S
tate
s
Spain
B-S
-J-G
(C
hin
a)
Russia
Slo
vak R
epublic
Lithuania
Chile
Pola
nd
%
Student has both a bank account and a prepaid debit card Student has a bank account but no prepaid debit card
Student has a prepaid debit card but no bank account Student earns money from a work activity
Many students hold basic financial
products or earn money from work
Figure IV.2.1
On average, students who hold a bank account perform better in
financial literacy than students of similar socio-economic status
who do not have a bank account
Figure IV.5.5
-20
0
20
40
60
80
100
Slo
vak R
epublic
Russia
Lithuania
Pola
nd
B-S
-J-G
(C
hin
a)
Chile
United S
tate
s
OE
CD
avera
ge
-10
Italy
Belg
ium
(F
lem
ish)
Austr
alia
Spain
Canadia
n p
rovin
ces
Neth
erlands
Sco
re-p
oin
t d
iffe
ren
ce
After accounting for socio-economic status Before accounting for socio-economic status
Difference between students who have a bank account and students who do not
Financial literacy and financial decisions
How is financial literacy related to students’ financial behaviors?
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Slo
vak R
epublic
Belg
ium
(F
lem
ish)
Italy
Pola
nd
Lithuania
OE
CD
avera
ge
-10
Canadia
n
pro
vin
ces
Neth
erlands
Spain
Austr
alia
B-S
-J-G
(C
hin
a)
United S
tate
s
Russia
Chile
Not buy it
Save up to buy it
Try to borrow money from a friend
Try to borrow money from a family member
Buy it with money that really should be used for something else
Most students would save if they want to buy something for which
they do not have enough money
Figure IV.6.1
Percentage of students who gave the following replies to the question:
“Likelihood of students' response to the question “If you don’t have enough money to buy something you really want
(e.g. an item of clothing, sports equipment) what are you most likely to do?”
1,00
1,50
2,00
2,50
3,00
3,50
Try to borrow money from a family
member
Try to borrow money from a friend
Save up to buy it Not buy it
Odds r
atio
Level 2 or 3 Level 4 or 5
Students' financial literacy is associated with
understanding the value of saving
Figure IV.6.2
High performing students are
more than twice as likely as low-
performing students in financial
literacy to choose the statement
"Save up to buy it" rather than
"Buy it with money that really
should be used for something
else“, after accounting for
performance in mathematics
and reading and other
characteristics.
What do the results mean for policy?
Financial literacy
skills for all
students
Address the needs of low-performing
students Tackle socio-
economic inequalities
early on
Provide equal opportunities for learning to boys
and girls
Help students make the most of
available learning opportunities at
school
Target parents at the same time as
young people
Provide young people with safe opportunities to
learn by experience outside of school
Evaluate the impact of
initiatives in and outside of
school
A multifaceted policy agenda
• Videos, competitions, interactive tools, events
(money weeks, savings day), museums, serious
games
…complementary to school initiatives
…can reach out-of-school young people
… participation of non-profits and private sector to be monitored
…again their impact needs to be evaluated more regularly
Out of school initiatives
www.oecd.org/finance/financial-education
and remember: Without data, you are just
another person with an opinion
Thank you
Muchas Gracias
Obrigado Find out more about our work at www.oecd.org/pisa
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