German poll shows poor financial education across Europe
Europeans consider their knowledge of financial investments to be limited and they would welcome more financial education in schools and vocational training, according to a poll conducted for the BVI, the German asset management trade association.
The survey by YouGov on behalf of the initiative “Investmentfonds. Nur für alle” showed 58% of the more than 11,000 respondents categorised their own knowledge of financial investments as “mediocre” to “poor”.
Just 2% described themselves as “extremely well informed”, and 5% as
“very well informed”. The remaining 31% considered themselves “well” informed.
“The survey shows that Europeans see a need for action with respect to their
private pension arrangements,” said Thomas Richter, the CEO of the BVI. “The financial education of the population is so patchy that they are hardly capable of making sensible financial decisions on their own.”
In Germany, over one half (51%) described their understanding of financial investments as limited. However, with 49% of the respondents “extremely well” or “well” informed, Germany still takes third place among “investment experts”. Only the Austrians and the Greeks consider their knowledge to be better on average.
On the other hand, the English regard themselves as ill-informed, the BVI poll said, with 70% considering their knowledge to be mediocre to poor. “The European comparison refutes the widespread cliché that the British know a lot about financial investments,” says Richter.
Yet a massive 93% of Europeans wish for more financial education in schools and in vocational training. Demand is most pronounced in Portugal (99%) and Greece (95%). Only the French, with 78% in favour, are somewhat more reticent.
“The result confirms our opinion that financial education is often a blank space in school lessons. Anyone who is expected to assume more responsibility for his or her financial security in retirement needs a minimum of basic knowledge about economics and finance,” said Richter.
“One’s own knowledge is the best consumer protection. If the consumers avoid making mistakes in their savings, not only would they themselves profit, but the state would as well. Because the more provisions the individual has made for retirement, the less the state has to contribute via transfer payments.”
The BVI aims to contribute to improving the financial knowledge among young
people via its educational initiative “Hoch im Kurs”, which promotes understanding of how the economy and markets function as well as financial planning.
In Germany, teachers have used more than one million BVI brochures in lessons since 2006, and mutual fund companies have been providing information to upper secondary schools since April 2010. More than 550 schools have registered interest in the next BVI programme “Finanzexperten in die Schulen”, where experts visit classes.
“The response from the schools shows how important it is to provide this kind of information,” said Richter. “However, private initiatives can only be a fallback solution. Financial education is a public mandate and should be taught by the state within the framework of a school subject. Education policy is called for here.”
YouGov questioned a total of 11,268 participants from 11 European countries (Germany, England, France, Greece, Italy, Norway, Netherlands, Austria, Portugal, Switzerland, Spain) using an online questionnaire. Data was collected between 4. February and 26. February 2013.