Spain ranks fourth from the bottom in Europe for financial skills, according to the 2023 Eurobarometer. Young people and the elderly are the groups with the greatest deficiencies, in a context of easy access to financial products through the internet and social media.
Spain is positioned fourth from the bottom in the European Union in financial literacy, according to the latest Eurobarometer of 2023. Young people and the elderly concentrate the greatest deficiencies in economic skills, according to data collected by La Razón on the occasion of Financial Education Day, which was celebrated on October 5.
The environment in which young people begin to interact with money has changed in recent years. Since the pandemic, they have navigated a scenario of economic instability, inflation, and loss of purchasing power, compounded by structural problems such as low wages, precarious employment, and difficulties in accessing housing. All of this limits their financial maneuverability and their chances of building an independent life project.
At the same time, it has never been easier for young people to take out financial products. With a click, they can open a current account, apply for a credit card, or invest in virtually any market. Young people easily double the average population's investment in cryptocurrencies. This ease of access raises the demand for financial knowledge to assess the implications of each product.
Financial information has also changed. Young people have access to an almost unlimited amount of content online, much of it through social media. The Bank of Spain and the CNMV have repeatedly warned about the risks of financial influencers and the rise of investment scams that promise extraordinary returns.
To develop their own judgement, financial education requires solid basic skills, such as mathematics and reading comprehension. The PISA 2022 report showed that 76% of the differences in financial performance among students can be explained by their performance in mathematics and reading. The results of the latest report published this year in these subjects have plummeted to historic lows.
The family remains the primary financial school. According to a Funcas survey, 74% of young Spaniards claim that it is at home where they have learned the most about managing money. Talking about money at home, managing an allowance, or understanding why sometimes something can be bought and other times it cannot are valuable experiences, but not all young people have access to that environment.
Incorporating financial education as a compulsory subject in schools would ensure that all young people acquire basic knowledge, regardless of what they have learned in their family environment. Empirical evidence shows that receiving financial education from an early age translates into adults who save more and better prepare for retirement.
Financial education cannot solve these problems by itself, but it can help to face them better
Financial Education Day, celebrated every October 5, serves to reflect on the collective preparedness to make responsible economic decisions. The available data shows that there is still a wide margin for improvement in Spain.
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