A Shocking Number Of Australians Lack Basic Financial Literacy

Post by Sharat on September 14, 2018 · Under News · Comments Off on A Shocking Number Of Australians Lack Basic Financial Literacy 

It is hardly surprising that the results of a new survey suggest that Australians who lack financial literacy tend to have low levels of savings, probably do not have much of an emergency fund and continue to carry credit card balances instead of paying down debt. The survey conducted by the University of Melbourne polled a group consisting of 15,000 people from both genders and every age group. Men tended to be more literate as were middle aged respondents in comparison to females, younger age groups and the elderly.

The results are troubling

The survey results produced some results that were particularly troubling when it comes to personal finance. Respondents who performed poorly in terms of financial literacy also tended to save less. They also found it much harder to raise at least $3,000 in the event of an emergency and many do not have a credit card. Those that did have credit cards said they either never, rarely or not often pay off their outstanding balance in full.

Clueless first home buyers

The results of this latest survey follow hot on the heels of another survey conducted by ME Bank which suggests that most first-time home buyers are clueless when it comes to their knowledge of property. The survey polled 1,000 young first time home buyers and found that almost three quarters of them felt they confident making financial decisions despite the fact that more than half of those polled failed a basic financial literacy test administered by the bank.

Unaware of basic facts

The survey results suggested that 85 per cent of first time home buyers were unaware there is no cooling off period when buying a property at auction and 78 per cent were ignorant of the fact that a deposit is required on the day of the auction. Experts say that financial literacy is extremely important because it allows people to save money over an entire lifetime, particularly when it comes to making the biggest investment in one’s life.

Its never to late to learn

Financial decisions such as how much to save, buying property or paying down debt should be based on facts rather than instinct because instinct based decisions could end up losing people thousands of dollars. When it comes to finance though, it is never to late to learn. There are plenty of resources online. People have access to guides and tips for no cost at all and there is no time like the present.

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