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Financial literacy efforts have limited impact, study says

An international academic study has found that financial literacy education doesn’t help most people much.

The paper, Financial Literacy, Financial Education and Downstream Financial Behaviors, by three business school professors, reviewed studies that found people don’t remember most of what they learn for very long.

Those who receive financial education do not perform noticeably better when it comes to saving more, or avoiding debt. Efforts aimed at low-income people are particularly weak.

“The financial services industry – either on its own or as required by government regulators – needs to find ways to make it easier for people to make sound decisions,” Richard Thaler, professor at University of Chicago, wrote in a New York Times column about the study. ◊