Every three years, the OECD International Network on Financial Education (OECD/INFE) conducts an international study that explores different elements of financial literacy, such as financial knowledge, financial behaviours and financial attitudes. Thirty-nine states participated in the latest edition of the survey, including Luxembourg, which was measured for the first time.

Respondents were polled in December 2022 and the were published in December 2023. In a issued on 15 December 2023, Luxembourg’s Financial Sector Surveillance Commission (CSSF) and the Luxembourg Bankers’ Association (ABBL) foundation for financial education called for better educational initiatives in this area. “If benefiting from good reflexes in terms of managing your money on a daily basis has always been essential, it is all the more true at present,” CSSF director general said in the press release, referring to geopolitical and environmental crises, inflation, high interest rates and uncertain economic prospects.

Here are a few takeaways from the survey.

High financial literacy score, but…

With a score of 63 out of 100 in financial literacy (consisting of financial knowledge, behaviour and attitudes), Luxembourg ranked fifth out of the 39 states that participated in the OECD’s survey.

People in Luxembourg aged 18-29 had a slightly lower financial literacy level than the rest of the population (60, the same as the OECD average). The country ranked 14th in terms financial literacy when focusing on this age group.

But only 53% of Luxembourg’s adult population reached the minimum target score defined by the OECD to be considered “financially literate,” found the survey. The OECD average stood at 39%; in Germany, the top-ranked participant, 75% of adults reached the minimum target score.

Luxembourg 10th in terms of financial knowledge

In the financial knowledge part of the study, participants were asked seven questions related to inflation, the benefits of long-term saving/investing, interest and risks. Luxembourg ranked 10th in the list, with an average score of 71 (just above the OECD average of 67). The top five were Hong Kong (China) (91), Germany (85), Estonia (78), Korea (76) and Hungary (74).

Compared to the OECD average, participants in Luxembourg performed the best on the questions related to time value of money (inflation) and interest calculations.

Around two-thirds (65%) of the grand duchy’s adult population reached the minimum target score on financial knowledge, above the OECD average of 58%, putting the country in 10th place.

However, when looking just at adults aged 18-29 years of age, only 57% of participants in Luxembourg reached the minimum target score. That’s below the OECD average of 63% and ranks the country in 24th place (out of 39).

Financial behaviour: youths score better than OECD average

To evaluate financial behaviour, the OECD’s survey asked respondents about keeping track of money in the short term, how they watch their personal financial affairs, setting long-term financial goals, comparing financial products across providers, actively saving, paying bills on time and considering purchases.

The financial behaviour of adults in Luxembourg (average score of 67) is better than the OECD average (62), but not among the best. The top five are Malta, Saudi Arabia, Germany, Ireland and Indonesia; Luxembourg comes in ninth place.

Respondents in Luxembourg did pretty well in terms of active saving and long-term financial planning, but not as well regarding keeping track of money in the short term. The study also found that 83% of adults in Luxembourg hold savings, investment or retirement products, ranking it sixth amongst the survey participants (the OECD average was 57%).

63% of adults in Luxembourg reached the OECD’s minimum target score in terms of financial behaviour (above the OECD average of 52%), which puts it in eight place.

While Luxembourg’s adults aged 18-29 scored better (65%) than the OECD average (60%) regarding financially-savvy behaviours, their score was still below that of the country’s overall adult population.

Long-term financial attitudes

The OECD’s study found that 57% of adults in Luxembourg disagreed with the statement “I tend to live for today and let tomorrow take care of itself,” 13 percentage points lower than the OECD average (44%).

60% have money left over at end of month

Regarding the objective aspects of financial well-being, Luxembourg scored pretty well compared to the OECD average.

Other findings

In Luxembourg, 6.8% of adults hold sustainable finance products (in second place after Germany, where 14.9% of adults hold sustainable finance products). 84% of respondents said they hold credit products, making Luxembourg the country where the highest percentage of the population holds a credit. 15% of adults in the grand duchy have been a victim of a financial fraud or scam.

89% of adults in Luxembourg disagreed with the statement “I share the passwords and pins of my bank account with close friends.” That means about one out of 10 people do share the passwords and pin numbers of their bank accounts.

More than nine out of 10 respondents in Luxembourg (91%) have transferred money to others online, the top score in the survey. 10.8% of adults hold cryptoassets (the second highest rate amongst the countries surveyed).