The Long-term Impact of Financial Literacy on Wealth: Evidence From Longitudinal Data
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De Beckker, Kenneth
Frijns, Bart
Hubers, Frank
Derkx, Sjuul
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Elsevier BV
Abstract
This paper investigates the long-term impact of financial literacy on wealth accumulation using unique longitudinal data on Dutch households, thereby resolving important endogeneity issues that plague cross-sectional analyses. We find that financial literacy significantly influences income and savings, driving wealth accumulation over time. The effects vary by age: younger individuals with higher financial literacy tend to earn more, whereas older individuals prioritize savings. Additionally, we identify a notable gender disparity, where financial literacy significantly influences wealth accumulation for men, but has no significant impact for women.
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14 Economics, Economics, 38 Economics, Financial literacy, Financial education, Wealth, Income, Savings
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Economics Letters, ISSN: 0165-1765 (Print), Elsevier BV, 112682-112682. doi: 10.1016/j.econlet.2025.112682
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This is an open access article distributed under the terms of the Creative Commons CC-BY license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. You are not required to obtain permission to reuse this article.
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Except where otherwise noted, this item's license is described as This is an open access article distributed under the terms of the Creative Commons CC-BY license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. You are not required to obtain permission to reuse this article.