Luxembourg Struggles with Financial Literacy: Government Takes Action to Promote Education and Sustainable Policies
The Problem
A recent OECD financial literacy survey has revealed that Luxembourg residents lack financial knowledge and responsible behavior, scoring a mere 60 out of 100. This score is below the OECD average for all age groups, with young adults aged 18-29 years old scoring an even lower 52 out of 100.
The Importance of Financial Literacy
Financial literacy is crucial for individuals and society as a whole, enabling personal finance management, promoting economic growth, social inclusion, and retirement planning. The government recognizes its significance and is taking steps to address the issue.
Calls for Action
The ABBL Foundation for Financial Education and the CSSF have called for the introduction of financial education in elementary and secondary schools, as well as better coordination of existing initiatives that currently reside mainly in extracurricular activities. Finance Minister Yuriko Backes has also emphasized the importance of making financial education accessible to all.
Government Initiatives
This week, Finance Minister Yuriko Backes and Development Cooperation and Humanitarian Affairs Minister Franz Fayot signed an agreement to extend Luxembourg’s partnership with the Alliance for Financial Inclusion (AFI) for a second phase. The partnership aims to advance inclusive and sustainable policies and regulations in Eastern Europe, Central Asia, the Middle East, and North Africa.
The agreement also seeks to:
- Expand technical cooperation and knowledge exchange with stakeholders in the Luxembourg inclusive finance ecosystem
- Engage with the broader European stakeholder community
- Collaborate with global financial standard-setting bodies
Multi-Donor Financial Inclusion Policy Implementation Facility
AFI’s Multi-Donor Financial Inclusion Policy Implementation Facility will advance financial inclusion in Africa and the Arab Region. This facility aims to increase access to financial services for underserved communities, promote financial stability, and support economic growth.
Conclusion
Luxembourg’s government is taking concrete steps to promote financial education and sustainable policies, recognizing the importance of financial literacy for citizens’ well-being and prosperity. By promoting financial literacy and inclusive finance, the government can help individuals make informed decisions about their finances and contribute to a more stable and prosperous society.