On the Anatomy of Financial Literacy in Italy

Using survey data on a sample of the Italian population, in this paper we offer a comprehensive account of which personal characteristics are associated to adequate financial competence and wise financial behaviour. The study uses five indicators of individual financial competence and behaviour and provides evidence on how each indicator is connected to individual characteristics such as gender, age, marital status, labour market status, income and education. Two indicators measure competence and awareness of the financial environment, while the remaining three capture specific elements of financial behaviour such as attitude towards budget constraints, propensity to save and planning for retirement. As expected, the pattern of correlations is rather homogeneous across the five indicators. In particular, we find that being a woman or being less educated is associated to less familiarity with the financial environment.