Aberdeen has called for more to be done to financially educate women of a younger working age, after research showed that women lag men in financial literacy.
Aberdeen’s research, using the Global Financial Literacy Excellence Centre ‘Big Three’ questions, shows that just under one third of Brits have good financial literacy. However, while men and women score similarly overall, it differs significantly at the more extreme ends.
Some 12% of men have ‘very poor’ financial literacy compared to 22% of women. Meanwhile, 41% of men demonstrate ‘very good’ literacy, compared with just 18% of women.
The Government’s recently updated Financial Inclusion Strategy acknowledges that gender should be taken into consideration as the Strategy progresses. Aberdeen believes the Government should focus on targeted initiatives that address the specific impact of financial exclusion on women.
“This is a notable omission given the distinct challenges they face, including the gender pay gap, career breaks, and lower pension accumulation. More must be done to engage women of a younger working age.” Aberdeen said.
Aberdeen has also called for the UK to go a step further than participation in the OECD PISA 2029 Financial Literacy Assessment, tracking emergency savings levels, insurance coverage, investment participation, usage of debt advice and buy now pay later schemes as well as financial literacy attainment, broken down by vulnerability, income, gender and region.
According to Aberdeen, publishing regular, easy to navigate data would allow policymakers, educators and community organisations to track progress, identify gaps early, and ensure support reaches the people who need it most.
Kristina Church, group head of sustainability at Aberdeen, said: “Many people in the UK still find money matters confusing or intimidating, not because they lack ability, but because the support around them is inconsistent, inaccessible or simply not designed with real life needs in mind.
“These gaps can have real consequences: missing bills, problem debt, financial stress and entering later life with smaller pension savings. Over time, these individual impacts add up, affecting households, communities, and the wider economy.
“It is critically important to engage women in financial education at an early age, ideally before they enter the labour market. Explaining and educating young women on the benefits of engaging with critical financial issues such as pensions earlier, starting in schools, can make a huge difference by the time they reach later-life. Financial education is not a “nice to have”, it is a critical life skill.”
Aberdeen warned that gaps in financial literacy can have meaningful long-term financial outcomes, with median average pension pots among those with ‘very good’ literacy reaching £62,500 compared with £17,500 for those with ‘very poor’ literacy.
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