Financial education: a position paper

Financial education: a prerequisite to economic autonomy and social participation

Financial education is an essential prerequisite to economic autonomy and social participation. It allows people to make well informed financial decisions and protect themselves against financial risks. A solid financial education promotes responsible use of money, reduces debt ratios, supports establishment of appropriate pension provisions and can, over the long term, provide relief to social services. It is therefore essential that we set an overarching goal of establishing financial education as a core mandate in the minds of both government and private bodies.

Financial education is more important than ever, particularly in light of the threat of poverty in old age and increasing burdens on the statutory pension system, all exacerbated by demographic change. This is especially true in times of economic uncertainty, which we are facing due to years of economic stagnation, price increases and geopolitical instability. But of course, financial education effects more than just pension provisions: people have to think about and understand money in order to protect and grow their financial assets. And yet, although it is more important than ever, there is still simply not much attention paid to financial education in Germany.1 It is therefore crucial that public and private entities take coordinated measures in order to ensure that a solid financial education is widely understood as important, while also working to improve access to financial education. Here, Germany’s private banks can function as a competent partner, and they are already taking on this responsibility.2

The first priority must be to clearly define national goals and ensure said goals are used to guide all subsequent activities.