EU citizens are not doing well when it comes to financial literacy. Nearly half lack an understanding of basic financial concepts, including inflation.

EU citizens are not doing well when it comes to financial literacy. Nearly half lack an understanding of basic financial concepts, including inflation.

A third of Europeans do not understand how inflation works, according to a survey by Eurobarometer. The same survey revealed only 18% of EU citizens were able to show a high level of financial literary.

According to the survey, 65% of EU citizens are aware that, in times of positive inflation, the purchasing power of their money decreases, meaning they can buy less than they could before with the same amount of money.

Lack of knowledge about inflation could be seen as concerning

In October 2022, the annual inflation in the EU reached levels not seen before in the previous four decades at 11.5%. While the rising cost of living was the most pressing worry for 93% of Europeans at that time, apparently a third of EU citizens do not know how inflation affects their lives.

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The best performers were the Netherlands (43%), Denmark (40%), Finland (40%) and Estonia (39%) where about four in 10 respondents display a high level of financial knowledge.

Romania and Portugal reported the worst scores in high levels of financial knowledge at 13% and 16%, respectively.

  • Flying Squid@lemmy.worldMEnglish
    0·
    7 months ago

    Ask 10 economists if inflation is beneficial or detrimental to an economy and see how many answers you get.

    Sure, it’s good to know that “you likely can’t afford as much in periods of inflation” but that really doesn’t tell you much. It certainly tells you nothing that you really need to know like what you can do about it.

    • Eatspancakes84@lemmy.worldEnglish
      0·
      7 months ago

      What a straw man. The question is: what is inflation? Not: is inflation beneficial or detrimental.? The latter is indeed a more subtle question, but that’s

      • Flying Squid@lemmy.worldMEnglish
        0·
        7 months ago

        No, the question was how financially literate are Europeans. Hence the headline: How financially literate are Europeans? Not very - but who knows most?

        And my answer is still- it’s basically impossible for most people, if anyone, to be financially literate in 2024.

        • Neuromancer@lemm.eeEnglish
          03·
          7 months ago

          That isn’t true. I’m literate as well as all my friends.

          Lemmy is just an echo chamber of financial illiteracy. It’s mind boggling how few basic concepts are understood here.

          The questions are in the article I see there missed all the time here.

          • Flying Squid@lemmy.worldMEnglish
            0·
            7 months ago

            Are you literate or do you think you’re literate? Have you and your friends taken any evaluations to back that up? If so, who designed the evaluations?

            Because I bet could I find an economist who would tell you that all sorts of things you think you know about how economies were are entirely wrong. And then a second one to tell you that everything that the first economist says is wrong.

            • Neuromancer@lemm.eeEnglish
              03·
              7 months ago

              I just the evaluation listed in the article. I got 100%. It’s only 5 questions.

              You are confusing with economics with financial literacy. Not exactly the same things

              Americans generically are horrible at financial literacy. It’s something that should be taught in school. It was when they went to high school. Hence why I can answer the questions easily.

              • Flying Squid@lemmy.worldMEnglish
                0·
                7 months ago

                Americans genetically are horrible at financial literacy.

                Uh…

                It’s something that should be taught in school.

                If Americans are genetically horrible at it, you can’t teach it to them.

                  • Flying Squid@lemmy.worldMEnglish
                    1·
                    7 months ago

                    Okay, well anyway, I think the test is confusing economics with financial literacy because not knowing the connection between bond prices and inflation doesn’t show you’re financially illiterate. Not knowing details about bond investment is not a sign of financial illiteracy. If it was, almost everyone would be financially illiterate because most people aren’t doing a lot of trading in the bond markets.