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Financial Literacy of Middle and Older Generations: Comparison of Japan and the United States

Author

Listed:
  • Satoshi Shimizutani

    (Nakasone Yasuhiro Peace Institute)

  • Hiroyuki Yamada

    (Faculty of Economics, Keio University)

Abstract

Financial literacy holds growing interest for managing assets/savings during the longer retirement period currently experienced in rapidly aging countries. We examine and compare levels and determinants of financial literacy as well as its association to asset allocation among middle and older generations of Japan and the United States. We present some interesting findings. First, financial literacy is generally associated with educational attainment, cognitive skills, coursework in economics or finance, and income level. Second, financial literacy is associated with resultant asset allocation; individuals with higher literacy are more likely to invest in stocks or securities separate from their savings. These patterns are commonly observed in Japan and the United States.

Suggested Citation

  • Satoshi Shimizutani & Hiroyuki Yamada, 2018. "Financial Literacy of Middle and Older Generations: Comparison of Japan and the United States," Keio-IES Discussion Paper Series 2018-016, Institute for Economics Studies, Keio University.
    • Handle: RePEc:keo:dpaper:2018-016
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    Cited by:

    1. Shimizutani, Satoshi & Yamada, Hiroyuki, 2020. "Financial literacy of middle-aged and older Individuals: Comparison of Japan and the United States," The Journal of the Economics of Ageing, Elsevier, vol. 16(C).
    2. Fujiki, Hiroshi, 2020. "Cash demand and financial literacy: A case study using Japanese survey data," Japan and the World Economy, Elsevier, vol. 54(C).
    3. Hiroshi Fujiki, 2020. "Empirical Analysis on Understanding of Financial Products," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 16(7), pages 1-25, October.

    More about this item

    Keywords

    financial literacy; Japan; U.S.; JSTAR; HRS;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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