ANALYSIS AND EVALUATION OF FINANCIAL EDUCATION OF THE POPULATION IN GEORGIA

Abstract

The article, based on the latest literary sources and comprehensive factual material, studies and assesses the current level of financial education of the population of Georgia; discusses important components of financial education, financial knowledge, financial behavior, and financial relationships; calculates the generalizing rate of financial education of the population. Based on the submitted answers by the respondents, the report derived financial literacy scores. Financial literacy constitutes the combination of financial knowledge, financial behavior, and financial attitudes. These components were studied separately and scores were assigned to each of them individually. The financial knowledge score takes a value between 0-7 based on the 7 core knowledge questions of the survey; the financial behavior score takes a value between 0-9 based on the responses to 9 behavior questions and statements; lastly, the financial attitude score was calculated using a 5-point scale based on an average of the answers to three attitudinal statements. In this case, respondents assessed their attitudes (i.e. how much they agreed or disagreed with given statements) from 1 point (i.e. fully agreed) to 5 points (fully disagreed). The overall financial literacy score is obtained as the sum of the three individual scores (financial knowledge (7), financial behavior (9), and financial attitudes (5)). Thus, the overall financial literacy score can take a value between 1 to 21 and can also be normalized by multiplying to 100 (100/21). Both scales - i.e. 21-point scale and 100-point scale- are used throughout this document for reporting purposes.

Keywords

• financial education, knowledge, behavior, financial attitudes, individual financial wellbeing, household, planning, budgeting.