Financial literacy of Portuguese students meets OECD standards

The financial literacy of students in Portugal is in line with the OECD average, but young Portuguese, despite having less exposure to digital financial products and activities, stand out when it comes to comparing prices.

This conclusion is based on the PISA 2022 financial literacy assessment, which assesses the performance of 15-year-old schoolchildren across various dimensions and the results of which were published today.

According to data for Portugal compiled by the Institute for Educational Assessment (IAVE), Portuguese students scored 494 on a scale of 0 to 1000, in line with the Organization for Economic Co-operation and Development (OECD) average of 498.

Among the 20 countries that took part in the financial literacy assessment, Portugal ranks 9th in the assessment, which examines aspects such as family, social, individual and work contexts, content such as financial planning and management, risks and benefits or financial scenarios. and processes associated with identifying and analyzing financial information, situations and problems.

The results indicate the influence of students’ socioeconomic status accounts for around 10% of the achievement gap, with the most disadvantaged students scoring on average 74 points lower than their more advantaged peers, and immigrant youth also having lower achievement. .

However, the strongest correlation is between financial literacy scores and math and reading literacy scores, which account for 79% of the variance.

Looking at the lowest performing students, 91% also performed worse in math and 83% in literature. In contrast, 53% of students who performed best in financial literacy were equally successful in mathematics and 38% in literature.

According to a global assessment, about 85% of students have achieved a minimum level of proficiency (82% in the OECD), and 6.6% are considered “top achievers”, that is, able to “apply a wide range of financial terms and concepts.” , analyze complex financial products and solve non-routine financial problems that are likely to become relevant only in adulthood.”

Results are also higher than the OECD average for boys compared to girls, but there are ways in which Portuguese students differ from their peers in other countries.

For example, when it comes to comparing prices, 80% of Portuguese students compare prices across multiple stores before making a purchase, and 72% make this comparison between brick-and-mortar stores and online stores.

Seven out of 10 students go further and prefer to wait until an item is cheaper before buying it, a behaviour that only about half of young people follow on average across the OECD.

On the other hand, the Portuguese are significantly below average when it comes to exposure to financial products and digital financial activities, especially when it comes to having a bank account (38% compared to 63% OECD average) or debit card. or credit (27% vs. 62%).

Online purchases and payments using a mobile phone or bank card are more common, but even so, national students are lagging behind and are also less confident in using digital financial services.

At the same time, just over half of young people feel confident when making money transfers, making payments using mobile devices and ensuring the security of confidential information when making a payment or using online banking.

When faced with certain financial terms, students know the meaning of six out of a list of 16, and most of them know what the terms “salary”, “bank loan” or “budget” mean, for example.

However, less than 20% know what “compound interest,” “exchange rate,” “amortization,” and “diversification” are.

The PISA 2022 study also looked at the school context and concluded that 32% of students participate in financial literacy activities in maths lessons and 30% in civics lessons, but are more likely to encounter tasks that explore the difference between spending money on what you want. need or want.