How Financially Literate Are Women? An Overview and New Insights
Global Financial Literacy Excellence Center Working Paper No. 2014-5
35 Pages Posted: 27 Mar 2015
Date Written: December 15, 2014
We document strikingly similar gender differences in financial literacy across countries. When asked to answer questions that measure knowledge of basic financial concepts, women are less likely than men to answer correctly and more likely to indicate that they do not know the answer. In addition, women give themselves lower scores on financial literacy self-assessments than men. Both young and old women show low levels of financial literacy. Moreover, women for whom financial knowledge is likely to be very important — for example widows or single women — know little about concepts relevant for day-to-day financial decisions. Even women in favorable economic conditions are less financially knowledgeable than men. This is important because financial literacy has been linked to economic behavior, including retirement planning and wealth accumulation. Women live longer than men and are likely to spend time in widowhood. As a result, improving women’s financial literacy is key to helping them prepare for retirement and promoting their financial security.
Keywords: Financial decision making, gender differences, financial literacy, financial sophistication, retirement planning
JEL Classification: D91, G11, D80
Suggested Citation: Suggested Citation