Educational Statistics

Financial Literacy Levels among Korean Adolescents

 

 

Author: Kim, Seulki (Associate Research Fellow, KEDI)

 

 

The rapid expansion of digital financial services has integrated children and adolescents into the market economy at increasingly earlier stages of life. While these environmental changes provide adolescents with new economic opportunities, they also entail substantially greater responsibility for financial decision-making and exposure to financial risks than those faced by previous generations (OECD, 2020). The OECD (2024) defines financial literacy as the combination of knowledge, skills, and attitudes that enables individuals to understand financial concepts and risks and to apply such understanding effectively in actual financial decision-making. These competencies not only improve household-level financial outcomes by enhancing the efficiency of individual decision-making, but also serve as a key mechanism for promoting overall financial well-being in society and ultimately enabling active participation in economic life. Therefore, to effectively respond to future economic uncertainty and proactively plan their financial futures, adolescents must develop responsible financial attitudes and behaviors from an early age, extending beyond the mere acquisition of financial knowledge (Bruhn et al., 2025, OECD, 2024).

 

This column examines the characteristics of adolescents’ financial lives and their levels of financial literacy using the Survey on the Financial Lives of Adolescents and the Financial Literacy Index developed by Kim, Ji-gyeong et al. (2023). In particular, these data are significant in that they provide a credible indicator for comprehensively assessing adolescents’ financial capability, given the absence of a standardized instrument or nationally approved statistics for measuring adolescent financial literacy as of 2023. The sample used in the analysis consisted of 2,870 elementary school students (Grades 4-5), 3,041 middle school students (Grades 1-3), and 2,847 high school students (Grades 1-3), and the survey was conducted between May and June 2023. The Financial Literacy Index, with a maximum score of 20 points, was developed based on the OECD/INFE conceptual framework and Atkins and Messy (2012), and comprises three subdomains: financial knowledge (7 points), financial behavior (9 points), and financial attitudes (4 points) (see Table 1). For purposes of comparability, Kim, Ji-gyeong et al. (2023) converted the raw scores to a 100-point scale and presented both the overall financial literacy score and the scores for each subdomain.

 

■ Financial Lives of Elementary, Middle, and High School Students

 

Before examining the financial literacy levels of elementary, middle, and high school students, the characteristics of adolescents’ financial lives are first presented below (see Figure 1). First, the proportion of students receiving an allowance increased with school level, from 74.7% among elementary school students to 81.5% among middle school students and 84.7% among high school students. In contrast, the proportion of students who reported always saving a fixed portion of their allowance gradually declined, from 27.5% among elementary students to 23.0% among middle school students and 21.3% among high school students.

 

Second, the use of financial products increased markedly as school level advanced. The proportion of students holding ordinary deposit accounts rose from 8.0% among elementary school students to 29.3% among middle school students and 51.6% among high school students. Similarly, the proportion using debit cards increased substantially, from 36.4% to 67.2% and 85.9%, respectively. In particular, the proportion of students using only cards issued under their own names increased sharply from 14.5% among elementary school students to 65.4% among high school students. This finding suggests that adolescents become increasingly autonomous and independent in conducting financial transactions as they progress through school.

 

Third, the proportion of students who had received financial education at school showed little variation across school levels, at 37.5% for elementary school students, 33.9% for middle school students, and 38.9% for high school students, remaining at a relatively low level overall. Compared with the expansion of adolescents’ financial transaction experiences, these findings indicate that school-based financial education has not been provided to a sufficient extent. Finally, the proportion of students reporting experiences of financial victimization was 12.1% among middle school students and 13.6% among high school students, indicating that exposure to financial risks increased alongside greater engagement in financial activities. This finding suggests that the expansion of adolescents’ financial transactions is accompanied by potential financial risks.

 

 

 

 

 

■ Financial Literacy Levels of Elementary, Middle and High School Students

 

[Figure 2] presents the financial literacy levels and scores for each of the three subdomains by school level and grade. The overall Financial Literacy Index recorded 63.5 points at the elementary school level, declined temporarily to 61.9 points at the middle school level, and then rebounded to 67.2 points at the high school level, indicating a non-linear pattern. By subdomain, financial knowledge scores showed little difference between elementary school students (74.2 points) and high school students (74.4 points), whereas middle school students recorded a relatively lower score of 67.0 points. Financial behavior scores increased consistently from the elementary to the high school level, whereas financial attitudes scores tended to decline as school level increased.

 

 

[Figure 2] Financial Literacy Levels of Elementary, Middle, and High School Students

Note: Reconstructed by the author based on the results of the Financial Literacy Survey conducted by Kim, Ji-gyeong et al. (2023).

 

 

A more detailed analysis by grade reveals a more pronounced pattern of asymmetric development. As students progress through school, cognitive competencies (financial knowledge) and behavioral competencies (financial behavior) are strengthened, whereas psychological competencies (financial attitudes) remain relatively stagnant or weaken.

 

Among elementary school students, financial knowledge scores increased by approximately 8 points between fourth and sixth grade, indicating substantial cognitive development. During the same period, however, financial attitudes scores declined by approximately 11.2 points, suggesting that the accumulation of financial knowledge and the development of financial attitudes progress in opposite directions. Among middle and high school students, overall financial literacy, financial knowledge, and financial behavior scores generally increased with grade level. Although financial attitudes scores declined slightly as grade level increased, differences across grades were relatively small. In particular, high school students scored above 70 points in both financial knowledge and financial behavior across all grades, indicating that they had consistently attained a relatively high level of cognitive and behavioral financial competency.

 

This pattern is also evident in comparisons between middle and high school students, for whom identical survey items were administered. Compared with middle school students, high school students scored 4.5-5.6 points higher in overall financial literacy, 6.2-8.2 points higher in financial knowledge, and 6.9-8.1 points higher in financial behavior, indicating an overall improvement in financial competency. In contrast, high school students scored approximately 3.5-4.2 points lower than middle school students in financial attitudes, representing the lowest level observed across all school levels.

 

Taken together, the findings indicate that while financial knowledge and financial behavior continue to improve from the elementary through the high school years, attitudinal and psychological aspects of financial competency – such as saving orientation and preparedness for financial risks – tend to weaken over time. This suggests that the imbalance among the components of financial competency becomes more pronounced during late adolescence. Accordingly, future financial education for adolescents should place greater emphasis not only on the acquisition of knowledge and skills but also on fostering responsible financial attitudes and cultivating long-term financial values.

 

 

[References]

º Kim, Ji-gyeong, Seo, Jeong-a, and Song, Hyeon-ju. (2023). How Well Do Adolescents Understand Finance?: Financial Literacy Levels and Financial Lives of Adolescents. Korea Youth Policy Institute Research Report, 1-356.

º Atkinson, A., & Messy, F. A. (2012). Measuring financial literacy: Results of the OECD/International Network on Financial Education (INFE) pilot study.

º Bruhn, M., Garber, G., Koyama, S., & Zia, B. (2025). The long-term impact of high school financial education: Evidence from Brazil. Review of Economics and Statistics, 1-45.

º OECD (2020), PISA 2018 Results (Volume IV): Are Students Smart about Money, PISA, OECD Publishing, Paris.

º OECD (2024), PISA 2022 Results (Volume IV): How Financially Smart Are Students, PISA, OECD Publishing, Paris.