Portugal ranked as the 2nd worst country in the EU in financial literacy.

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Portuguese are the second worst financially literate in the EU.

According to a study released by the Bruegel think tank, Portugal is the second worst country ranked in financial literacy in the European Union (EU), especially regarding issues such as inflation and interest rates.

The study was shared on the day when the EU Ministers of Finance and Economics met to discuss how to reduce obstacles, indicating that "on average, only one in every two people in the EU has financial knowledge".

This survey was conducted last year by the European Commission, and it shows that the Romanians interviewed are the worst in financial knowledge, followed by the Portuguese.

The European average of this study was 52% of respondents from 27 member states who answered correctly to at least three out of five questions. In Portugal, 42% of the respondents answered correctly to at least three out of the five questions. The five questions were related to compound interest, inflation, relationship between interest rates and bond prices, risk and return, and diversification of interests.

"In response to a 2023 survey containing five questions to assess basic financial knowledge, only half of the respondents answered correctly at least three out of the five questions, a fact that represents a low level of financial literacy and an obstacle for individuals to invest in financial markets," explains the Bruegel group, as reported on Notícias ao Minuto."

Financial literacy: What is the importance?  

On the contrary, countries with higher financial literacy rates and higher percentages were: Finland (73%), Estonia (67%) and Denmark (66%) and the lowest in Romania (36%), Portugal (42%) and Greece (43%).

This is justified by "countries with a higher proportion of people with financial knowledge" having "a higher number of people who save and borrow from a financial institution, indicating that financial knowledge can improve financial inclusion," as indicated by the financial studies group quoted in the news.

What still leads people with more financial knowledge to be "less financially vulnerable," as they are able to cover both expenses in the event of sudden loss of income and are more confident that they will have enough funds to sustain themselves during retirement," can still be read.

Note that "the questions most frequently answered correctly by respondents measured understanding of inflation and the relationship between risk and return. In contrast, only one in five respondents answered correctly a question about the relationship between interest rates and bond prices," reinforces the group, according to the information shared by the news website.

All EU countries consider it urgent for each to create a national financial literacy strategy to "ensure that financial education starts early and in schools," according to  the following URL:

It is worth noting that financial literacy begins with knowledge and understanding of concepts, but even more with the practice and ability to promote financial decision making.  

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