Explore the links between financial literacy, age and gender in Japan


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This figure shows the relationship between age, financial literacy, and self-rated financial literacy based on the estimation results in Table 2 for financial literacy. For self-rated financial literacy, we obtain marginal effects of age and age squared from an ordered logistic regression with self-rated financial literacy scores on a three-point Likert scale ( very low / low, fair and high / very high) for ease of presentation of results. Lines show point estimates, with shaded areas representing 95% confidence intervals, estimated by robust standard errors. Credit: Okamoto, Komamura, 2021, PLOS ONE, CC-BY 4.0 (creativecommons.org/licenses/by/4.0/)

Analysis of survey results from Japan reveals how financial literacy and financial behaviors are associated with age and gender, suggesting potential targets for policies to improve financial health. Shohei Okamoto from the Tokyo Metropolitan Institute of Gerontology and Kohei Komamura from Keio University in Tokyo, Japan, present these results in the open access journal PLOS ONE November 17, 2021.

In industrialized countries like Japan, people face the challenge of building up an independent wealth to support themselves as they age. Public policies could help improve people’s financial literacy in order to increase their savings and asset building capacities. However, to inform these policies, a better understanding of how financial literacy varies between individuals is needed.

To improve understanding of financial literacy in Japan, Okamoto and Komamura evaluated data from an online survey of 25,000 Japanese people aged 18 to 79. Participants answered multiple sets of questions to measure their financial literacy, self-assessed financial knowledge, and financial behaviors. . The researchers performed a statistical analysis of the responses to explore the links between financial literacy, age and gender.

The analysis found that in general, the financial literacy of survey participants increased with age before declining in their early sixties. Meanwhile, people’s confidence in their financial knowledge declined until the middle age for both men and women, before increasing again for older men.

Male survey participants had higher levels of financial literacy than female participants; statistical analysis suggests that this difference can be explained in large part by differences in education. However, women reported healthier behaviors financially.

These findings support policy development in Japan to provide older people with assistance in financial decision-making, strengthen financial literacy among women, and improve financial behaviors among men. In the meantime, future research will be needed to confirm the associations identified in this study, clarify their underlying causes, and examine their impact on the actual outcomes of managing individuals’ financial assets.

The authors add, “We found an inverse U-shaped relationship between age and financial literacy, while the opposite trend is true for age and self-rated financial literacy. ”


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More information:
Okamoto S, Komamura K (2021) Age, gender and financial literacy in Japan. PLoS A 16 (11): e0259393. journals.plos.org/plosone/arti… journal.pone.0259393

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