An increasing number of workers have to rely on personal savings and private pensions to fund their retirement as countries begin scaling back the benefits of state-supported social security programmes. As individuals increase their use of financial markets, it becomes more important that they understand at least the basics of saving and investment. Policymakers need to be able to identify individuals who are most in need of financial education and the best ways to improve that education, whether through government programmes, employers, schools, or some combination of these approaches.

The OECD has recently established a Financial Education Project to study financial education programmes in OECD member countries and selected non-member countries. In the first phase of this study, we will describe the types of financial education programmes that exist, analyze the effectiveness of these programmes, and develop a methodology that policymakers can use to compare strategies and programmes in both the public and private sectors.

The description of the types of financial education programmes will be based on a survey of member countries. The analysis of the effectiveness of the programmes will be based on a review of relevant studies in economics, social policy, education, and related fields as well as discussions with experts in the area of financial education.

We will use the information on the types of programmes and effectiveness of these programmes to develop a methodology that policymakers can use to compare strategies for improving financial literacy. The second phase of this project will be an in-depth survey of the financial literacy of individuals in a few selected countries. Such a survey will provide guidance for the countries selected on how to effectively address the issues of financial illiteracy.