National Financial Literacy Score 66.5 Points... "Weakness in Setting Long-Term Financial Goals"

Bank of Korea Conducts Nationwide Financial Literacy Survey Last Year

The Bank of Korea announced on the 29th that the financial literacy score of Korean adults was 66.5 points in a nationwide financial literacy survey conducted last year. Although the score slightly increased compared to the 2020 survey (65.1 points), financial management activities such as setting long-term financial goals were found to be weak, and the financial scores of the elderly aged 70 and above and low-income groups were relatively low.

This survey was conducted by the Bank of Korea through face-to-face interviews with 2,400 adults aged 18 to 79, assessing their overall understanding of finance, including financial knowledge, financial behavior, and financial attitudes necessary for rational and sound financial life.

Looking first at respondent characteristics, by age group, those in their 30s to 50s scored higher than the average (66.5 points), while those in their 20s (65.8 points), 60s (64.4 points), and 70s (61.1 points) scored lower. By income class, the high-income group (68.7 points) scored the highest, while the low-income group (63.2 points) scored below average. Additionally, financial literacy increased with higher educational attainment.

Breaking down the survey results, financial knowledge scored the highest at 75.5 points, followed by financial behavior (65.8 points) and financial attitude (52.4 points).

Last year, the financial knowledge score of Korean adults was 75.5 points. Financial knowledge refers to the basic knowledge that helps consumers compare financial products or services and make appropriate, informed financial decisions. Understanding of the concept of interest was high (93.8 points), but understanding of compound interest calculation was low (41.4 points).

The financial behavior score was 65.8 points. This category quantified consumer actions related to finance, such as financial planning, budget management, and informed selection of financial products. Korean adults were active in saving activities (97.8 points), but very weak in financial management activities such as checking financial status (55.7 points) and setting long-term financial goals (48.0 points). Only 37.7% reported having long-term financial goals.

Regarding saving and investment methods, deposit products with free withdrawal and deposit (90.6%) were preferred over fixed deposits or installment savings (39.5%).

Among financial behavior items, the score for informed selection of financial products was 50.8 points, significantly lower than the overall financial behavior score of 65.8 points. In the past two years, when choosing financial products or services, people tended to rely more on recommendations from friends, family, or acquaintances (58.4%).

Financial attitude, which scores higher when there is a preference for saving or the future, was low at 52.4 points. The attitude slightly favored the future over the present and saving over consumption, indicating a marginal tendency to sacrifice current consumption to prepare for the future.

Examining the characteristics of this survey’s results, the financial literacy score of those in their 70s increased significantly (by 6.4 points), narrowing the gap in financial literacy by age group. By education level, the financial literacy of respondents with less than a high school education also increased relatively significantly (by 2.8 points), reducing the gap among respondents by education level.

However, financial literacy remains relatively low among the elderly in their 60s and 70s, low-income groups with annual income below 30 million KRW, and low-education groups with less than a high school diploma.

The Bank of Korea stated, "We plan to continuously enhance the effectiveness of financial and economic education through cooperation with related organizations such as the Financial Supervisory Service," adding, "We will promote desirable financial behaviors such as checking financial status and setting long-term financial goals, and guide consumers to avoid damages from exaggerated advertisements and incomplete sales when selecting financial products."

This content was produced with the assistance of AI translation services.