Financial knowledge & portfolio complexity in Singapore
Financial knowledge & portfolio complexity in Singapore
Published 1 January, 2020
If we are able to raise the financial literacy level of Singaporeans while they are actively working, we will be able to help them prepare better for the long years of retirement
Benedict Koh
Professor of Finance (Education)
In brief
- Despite being one of the world’s most rapidly ageing nations, financial literacy in Singapore has not been analysed in great detail. The overall financial literacy among older adults in Singapore is comparable to those in the U.S.
- Financial literacy is associated with better financial decision-making. Those who are more financially literate are more confident in managing retirement, less worried about finances and more likely to accumulate wealth. Unfortunately, there is a gender gap in financial literacy worldwide.
- Academic literacy does not equate to financial literacy. Financial literacy must be regarded as a life skill that everyone should possess. More attention should be given to females who are generally less financially literate than males, and government and NGOs should be encouraged to organise programs targeting them. Financial services providers should also educate their customers before persuading them to purchase.
Do older Singaporeans score better on financial knowledge compared to their counterparts in the United States? What are the empirical linkages between financial literacy and retirement preparedness in Singapore? And is financial literacy positively associated with greater wealth and diversity of portfolios? Professor Benedict Koh from SMU’s Lee Kong Chian School of Business discusses the key findings of his research jointly conducted with Olivia Mitchell from the University of Pennsylvania and Susann Rohwedder, Senior Economist at the RAND Corporation and Associate Director of the RAND Center for the Study of Aging.
Financial literacy in Singapore has not been analysed in much detail, despite the fact that this is one of the world’s most rapidly aging nations. In this podcast, Professor of Finance Benedict Koh from the SMU Lee Kong Chian School of Business, discusses the key findings of his research jointly conducted with Olivia Mitchell from the University of Pennsylvania and Susann Rohwedder, Senior Economist at the RAND Corporation and Associate Director of the RAND Center for the Study of Aging.
Using a unique new data-set and nationally representative survey - the Singapore Life Panel, they conducted an analysis of older Singaporeans’ financial literacy.
Here, Professor Koh discusses his key findings, including: Do older Singaporeans score better on financial knowledge compared to their counterparts in the United States? What are the empirical linkages between financial literacy and retirement preparedness in Singapore? And is financial literacy positively associated with greater wealth and diversity of portfolios?