Financial Literacy In Australia

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INTRODUCTION

The definition of financial literacy by Organization for Economic Co-operation and Development (OECD) is “combination of financial knowledge, financial behavior and financial attitude necessary to make sound financial decisions and ultimately achieve individual well-being”. Financial literacy is helpful for an individual since it improves the understanding level of financial matters which ultimately helps them in processing financial information and also helps in making informed decisions about personal finance. It has been found generally that individuals with low levels of financial literacy face problem in managing finances such as savings, borrowings, investments, planning and retirement.
The importance of financial literacy
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The financial literacy was found to be highest among people aged between 50 to 60 years. However the level of financial literacy was found to be lowest among females and those from non- English speaking background. Al-Tamimi and Kalli studied the level of financial literacy among UAE investors. The results showed that the level of financial literacy among the investors of UAE was far from the needed level. There was difference in the financial literacy levels because of income level, education level and workplace activity.
Cole et al. in (2008) studied the level of financial literacy and predictions relating to it, and its relationship to demand for financial services in India and Indonesia. There existed a strong relationship between financial literacy and financial behavior. The result demonstrated that financial literacy is an important correlate of household financial behavior and household bell being. A survey by Agarwal et al. (2010) studied the financial literacy of online investors in Hyderabad. The findings showed that individuals had good level of financial
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Among the various researches the researchers have failed to establish any relationship between financial knowledge, attitude and behavior. No standard set of questions have been asked to determine the level of financial literacy. Here it becomes important to study the level of financial literacy among individuals in India and also study the impact of demographic factors on the level of financial

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