Mapping Financial Literacy: A Systematic Literature Review of Determinants and Recent Trends

Abstract

Financial literacy is a critical life skill that is essential for achieving financial security and individual well-being, economic growth and overall sustainable development. Based on the analysis of research on financial literacy, we aim to provide a balance sheet of current research and a starting point for future research with the focus on identifying significant predictors of financial literacy, as well as variables that are affected by financial literacy. The main methods of our research are a systematic literature review, and bibliometric and bibliographical analysis. We establish a chronological path of the financial literacy topic in the scientific research. Based on the analysis of the most cited articles, we develop a comprehensive conceptual framework for mapping financial literacy. We identified a large number of predictors of financial literacy starting with education, gender, age, knowledge, etc. Financial literacy also affects variables such as retirement planning, financial inclusion, return on wealth, risk diversification, etc. We discuss in detail the main trends and topics in financial literacy research by involving financial literacy of the youth, financial literacy from the gender perspective, financial inclusion, retirement planning, digital finance and digital financial literacy. Our research can help policymakers in their pursuit of improving the levels of individual financial literacy by enabling individuals to make better financial decisions, avoid financial stress and achieve their financial goals. It can also help governments in their efforts in achieving sustainable development goals (SDGs).