Financial Literacy: How well do you understand the ABCs of your personal finance?
A man and his ever-nagging wife went on holiday in Jerusalem. While they were there, the wife passed away. The undertaker told the husband: “You can have her buried here in the Holy Land for US$150 or we can have her shipped back for $5,000.’’ The husband thought about it and told the undertaker he would have her shipped back home. The undertaker asked him: “Why would you spend $ 5,000 to have her shipped home when you could have a beautiful burial here, and it would cost only $150?” The husband replied: “Long ago, a man died here, was buried here, and three days later, rose from the dead. I just can’t take that chance!”
So how is your financial literacy? These days financial literacy seems to be the buzz word among regulators, politicians, non-governmental organisations and the media. According to the Financial Literacy Survey that was conducted by the Financial Consumer Protection Centre of the Bank of Thailand in 2013, the financial literacy level of Thais was below the average score of 14 countries that participated in a survey by the Organisation for Economic Cooperation and Development. Essentially, there were three main components in the central bank survey: financial knowledge, financial behaviour and financial attitude. As was expected, low income and education levels are correlated with lower financial literacy scores. In particular, a rather large number of Thai people do not fully understand compound interest calculations, deposit protection policies, and the concept of the time value of money.
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