finder.com.au launches Money Savvy Challenge: money basics you should know
- finder.com.au is putting Australians to the test with its first Money Savvy Challenge
- Savings accounts, travel insurance and life insurance are the key struggle areas by Australians who have so far undertaken the survey
- Many Australians could be missing out on big savings by not knowing the basics!
July 24, 2014, SYDNEY –One of Australia’s biggest comparison websites finder.com.au has launched a Money Savvy Challenge to help Australians learn the basics about their financial products and bring awareness to the lack of financial literacy in Australia.
The Money Savvy Challenge was launched last month, with over 400 Australians already taking part. finder.com.au analysed the results of the responses and found that most were unaware of one or more product area. In fact, just 3 percent of respondents received a perfect score of 100 percent while the average score was 69 percent.
Michelle Hutchison, Money Expert at finder.com.au, said the Money Savvy Challenge was created in response to thousands of Australians asking for help from the comparison website every month.
“We receive thousands of money questions every month on finder.com.au through phone calls, live chat, email, forum, posts on our site and social media, so we wanted to find out how money savvy (or not) Australians really are.
“All Australians should know the answers to the questions in our Money Savvy Challenge and if they get them wrong they will learn the answers at the end and can find out more from guides and articles on finder.com.au.
The results found that the savviest state was Australian Capital Territory with an average score of 74 percent – 5 percentage points above the total average score of 69 percent.
Western Australian respondents came in at second place with an average score of 71 percent, followed closely by New South Wales respondents who scored 70 percent on average.
The least savvy state was Queensland, with an average score of 64 percent followed by South Australia with an average score of 67 percent.
finder.com.au analysed the results across eight different financial product areas which included home loans, savings accounts, credit cards, transaction accounts, personal loans, life insurance, travel insurance and travel cards.
The results revealed that Australians are most money savvy when it comes to personal loans, credit cards and home loans. For instance, the majority (over 80 percent) of respondents understood how to avoid Lenders Mortgage Insurance. Alternatively, Australians struggled with the basic details of life insurance premiums and most didn’t know how much money the government guarantees on APRA-approved deposit accounts.
Mrs Hutchison said many Australians could be wasting money because they don’t know the basic details about their financial products.
“It's alarming to find that so many Australians don’t have the basic financial knowledge about their banking products because they could be using the wrong products which don't suit their needs and therefore could be throwing hundreds – even thousands – of dollars down the drain.
"For instance, about half (48 percent) of the respondents who took the Challenge didn't know that they are charged inactivity fees on travel cards. Travel cards are a relatively new product to the market and growing popular with travellers and online shoppers.
"Almost all respondents so far failed in at least one financial topic, with just 3 percent scored 100%.
"If more Australians made an effort to learn about their financial products and chose deals that better suited them, it could not only have a significant impact on their financial well being but it could also improve competition between financial institutions. It's a win-win for consumers!"
“So far, Australians are proving they need to brush up on their financial knowledge. We’ll be releasing the final results when the quiz closes so people still have the chance to prove us wrong: https://www.finder.com.au/money-savvy-challenge.”
The most savvy state: ACT
- ACT was the most savvy state, with respondents scoring an average of 74% – 5 percentage points above the average score of 69%
- However they also took the longest average time to complete the challenge, taking over 14 minutes on average per entrant – or about one minute per question
- Financial literacy was a lot higher in the nation’s capital than anywhere else in Australia, with the lowest score for ACT respondents of 50%.
The least savvy state: QLD
- QLD were the least savvy, with an average score of just 64% – 5 percentage points under the average score of 69%
- The lower scores were concurrent with a quicker completion time, as Queenslanders only spent on average around six minutes to complete the challenge – about 26 seconds per question
- However there was one QLD respondent scoring 100%, and a further three respondents scoring above 90%.
The brightest were from Victoria
- Victoria had the most respondents scoring 100%, with 5 respondents nailing the challenge
- The statewide average test time was around seven minutes.
The financial topics Australians struggle with the most:
- Savings accounts: more than half (52%) of respondents didn't know certain details about savings accounts on average
- Travel insurance: about half (46%) of respondents were unaware claim requirements
- Life insurance: over 2 in 5 (41%) respondents on average didn't know the tax benefits of income protection insurance and penalties for life insurance if you're a smoker.
The financial topics Australians are on top of the most:
- Personal Loans: almost all respondents (94%) knew what personal loans could be used for
- Credit cards: over 4 out of 5 respondents (81%) we're savvy with their credit cards, being aware of overseas transaction charges and rewards programs
- Home Loans: about three-quarters of respondents (73%) knew the basics about home loans including how to avoid lenders mortgage insurance, multiple loans and offset accounts
For further information
The information in this release is accurate as of the date published, but rates, fees and other product features may have changed. Please see updated product information on finder.com.au's review pages for the current correct values.
finder.com.au is Australia's most visited comparison website and has helped over 4.8 million Australians find better credit cards, home loans, life insurance, shopping deals and more since 2006. finder.com.au compares 250 credit and debit cards from 31 providers, over 300 home loan products, and information from 13 life insurance providers as well as online shopping promo codes, mobile phone plans, travel insurance and more. One Australian every five minutes is using finder.com.au to find better (Source: Google Analytics).