Background

The demographic change is a great strain for state pension insurance policies. For this reason, it is necessary that people make additional private provisions for retirement. However, financial products for private investment – predominately triggered by the internet – have become more diverse and more complex. Thus, to make informed decisions with regard to one’s own financial resources more background knowledge is required. Effective and beneficial decision-making depends on several factors: on a basic understanding of financial matters (i.e., financial literacy), on geographic, cultural, and sociological aspects as well as on the ways in which information on that topic is presented. How much of the information on financial issues is reaching those for whom it is intended and what these people make of it, are questions that are still waiting for thorough answers.

Project Content

To correctly assess content on financial issues and to make the most of it several conditions have to be met: relevant information has to be made accessible, those who could benefit from it have to have the competences to understand it and be motivated to access it. In principle, financial issues are widely discussed and there is a myriad of information sources (in particular on the internet). Consequently, retrieving information is easy, but the variety of sources and their sheer number can make it difficult to separate relevant content from irrelevant content and find out whether a source is trustworthy. Basic media competences (i.e., media literacy) and competences on financial issues (financial literacy) could ameliorate this situation. However, studies on such competences are still scarce in Austria. Closing this knowledge gap is the main aim of the current dissertation project.

Goals

The project is aimed at investigating

• which competences it needs to foster a proper understanding of financial issues and private pension provisions.
• the ways in which such competences (i.e., financial literacy) influence the decisions of private investors.
• the ways in which information on financial issues is assessed and processed.

The research focus is on how people handle their financial resources depending on their income and whether they make investments that serve them well with regard to their retirement provisions.

Methods

The project is a mix of qualitative and quantitative methods. In a first step hypotheses on financial issues are derived from literature research and guided interviews with experts (financial experts, funds managers, journalists). These interviews give an overview of opinions on and attitudes towards financial issues as well as personal and subjective ideas on the complex relationships in this area. All this forms the backbone for generating hypotheses.

To test the hypotheses the essential content of the qualitative interviews is translated into a standardized questionnaire. This questionnaire is used in an online survey. Target group of the survey are private investors between 18 to 30 years because this age range marks a phase in life during which people start into working life and begin making important financial decisions on a greater scale.    

Results

Having competences to deal with financial issues in a proper way (i.e., financial literacy) as well as media competencies are vital for people in the 18 to 30 years age range, as they will face great societal change. The current project turns this into a research question and not only investigates which competences are required but also what role the sociodemographic and financial background plays in this context. Using the findings obtained and the knowledge base created during the MEETeUX project at St.Pölten UAS, a learning platform that supports people in acquiring  financial competences (mainly for young adults) will be built. This will make a contribution to improving the economic and social conditions (e.g., preventing excessive debt, maintenance of high living standards after retirement) in Austria.