BY BEN CLIFFORD
New research published by the University of Newcastle has found that more than a third of Australians are financially illiterate.
The research forms the basis of the Financial Wellbeing and General Life Satisfaction in Australia report released this week.
The report represents a combined effort between the University and the Greater Bank as a part of their Financial Literacy Program which has been operating across the Hunter region since 2019.
The findings provide a fascinating insight into the current state of Australian's knowledge levels when it comes to managing their money and demonstrates the impact financial literacy has on overall life satisfaction.
When it comes to financial literacy, young people have emerged as a key demographic of concern with 43% of 18-24 year-olds reporting they have not been able to meet their personal debt obligations.
Researchers have also found significant differences between men and women's financial management capabilities.
For example, young men have demonstrated higher levels of financial literacy than women, however, they are less likely to apply their financial knowledge to make positive economic decisions.
As cost of living pressures and interest rates continue to rise, the importance of having strong financial literacy is paramount.
Lead researcher, Professor Christina Boedker says people only need to take a few small steps to improve their financial literacy skills.
"A critical thing is to sit down and set a household budget. If you can start to plan you can start to better manage," he said.
"Set yourself some targets, critically review your income vs expenses and figure out what you're able to last on a monthly basis."
Through their joint outreach program, the University and Greater Bank are hoping to improve the worrisome financial status of young Australians.
The program currently helps high-school students learn the importance of household budgets, investments and savings, as well as the risks associated with credit cards and buy now pay later schemes.
There are hopes that similar programs will be rolled out across the University to further assist young adults in making informed financial decisions.
The peer-reviewed report is available for viewing at https://www.greater.com.au/financialwellbeing
