March 01, 2011
Singaporean Women Rank Highly in Money Management and Financial Planning: Inaugural MasterCard Worldwide Index of Financial Literacy
Singapore, 1 March 2011: Women in Singapore hold their own when it comes to being financially savvy, according to the results of the inaugural MasterCard Worldwide Index of Financial Literacy which were released today.
The Index ranked Singaporean women fifth out of 14 countries in the Asia/Pacific region. Thai women topped the Financial Literacy Index with an aggregate score of 73.9 followed closely by New Zealand (71.3), Australia (70.2), Vietnam (70.1) and Singapore (69.4). In contrast, developed markets Korea (55.9) and Japan (59.9) made up the lower spectrum of the Index.
The MasterCard Index is based on a survey of consumers from 24 markets across Asia/Pacific Middle East Africa (APMEA). It comprises three major components: Basic Money Management, which examines the respondents’ skills in terms of budgeting, savings and responsibility of credit usage; Financial Planning, which assesses their knowledge of financial products, services, concepts and ability to make long-term plans for financial needs; and Investment, which gauges their basic understanding of the various investment risks, different investment products and if they have the necessary skills.
The Index score is calculated from the weighted sum of the three components, with 100 as the maximum score in financial literacy and zero as the lowest possible score. The survey was conducted between 13 September and 11 November 2010 and will continue to be conducted on an annual basis.
Of the three components that make up the survey, women in Singapore ranked highly in the Basic Money Management (ranked 4th) and Financial (ranked 4th) portions with composite scores of 70.0 and 80.4 in these sections. Their scores in the Investment section of the survey however indicate room for improvement in investment skills and knowledge, with the score of 51.5 bringing down the overall ranking.
When it comes to basic money management, 71% of those surveyed in Singapore say they do not have problems staying on top of their bills and credit commitments while the same number also said that they understand the concept of compound interest. 33% of women surveyed however, admitted that they often have problems with setting money aside for big purchases.
When it comes to financial planning, Singaporean women appear to be well in control with 90% of those surveyed stating that they feel it is never too early to have a financial plan. 97% of those surveyed also believed that one should regularly save a portion of their monthly income and 92% of women surveyed believe they should have 3 - 6 months of cash savings to meet their emergency needs, such as illness or job losses.
Overall, Singaporean women stacked up well against their counterparts in developed markets, where New Zealand and Australia had the second (71.3) and third (70.2) highest overall Index scores. These markets also led in Basic Money Management with scores of 76.7 and 75.8 respectively. They did not perform as strongly in Financial Planning, coming in under the 14 market average, and Investment (58.3 and 55.2 respectively).
The most populous developing markets in the world, India (61.4) and China (60.1) reflected a relatively low Financial Literacy score among women. Chinese and Indian women are particularly weak in Basic Money Management (54.4 and 58.8), near the bottom of the ranking for that component in Asia/Pacific. While, Japan and Korea are the only two markets in Asia/Pacific with a Women’s Financial Literacy Index score that falls below 60.
Korean women are bottom of the rankings in two of the Index components: Basic Money Management (51.1) and Financial Planning (65.7), while Japanese women have the lowest investment score (38.4).
“It is clear from the findings of MasterCard’s first ever regional study on financial literacy, that women in Singapore have an appreciation for managing their personal finances. Saving, budgeting and investing are all important aspects of financial management, and while a majority of Singapore women are well-educated, there are still opportunities for them to enhance their knowledge of financial investment tools and strategies”, said Julienne Loh, vice president and Country Manager, Singapore, MasterCard Worldwide.
MasterCard Worldwide Index of Financial Literacy (Women)
|Overall Financial Literacy Index||Components of Financial Literacy Index|
|Basic Money Management||Financial Planning||Investment|
 Markets surveyed include Australia, China, Egypt, Hong Kong, India, Indonesia, Japan, Kenya, Kuwait, Lebanon, Malaysia, Morocco, New Zealand, Nigeria, Philippines, Qatar, Saudi Arabia, South Africa, South Korea, Singapore, Taiwan, Thailand, United Arab Emirates and Vietnam.
The MasterCard Worldwide Index suite in Asia/Pacific, Middle East and Africa includes the long-running MasterCard Worldwide Index of Consumer Confidence, as well as the MasterCard Worldwide Index of Women’s Advancement, Online Shopping, Index of Financial Literacy, and the Index of Global Destination Cities. In addition to the Indices, MasterCard’s research properties also include a range of consumer surveys including Ethical Spending and a series on Consumer Purchasing Priorities (covering Travel, Dining & Entertainment, Education, Money Management, Luxury and General Shopping).
MasterCard also regularly releases Insights reports providing analysis of business dynamics, financial policies and regulatory activities in the Asia/Pacific, Middle East and Africa region. Over 80 Insights reports have been produced since 2004.
MasterCard has also released a series of four books on Asian consumer insights, authored by Dr. Yuwa Hedrick-Wong, Global Economic Advisor for MasterCard Worldwide and published by John Wiley & Sons.
MasterCard (NYSE: MA), www.mastercard.com, is a technology company in the global payments industry. We operate the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products and solutions make everyday commerce activities – such as shopping, traveling, running a business and managing finances – easier, more secure and more efficient for everyone. Follow us on Twitter @MasterCardNews, join the discussion on the Cashless Conversations Blog and subscribe for the latest news.