Financial literacy is defined as the ability to make informed judgements and make effective decisions regarding the use and management of money.  

Financial literacy is seen as a spectrum covering financial knowledge and the understanding, confidence and motivation to make financial judgements and decisions.

Financial capability is another term for financial literacy, used by some countries and organisations to denote a more behavioural and action-oriented approach. 

Financial education is the process by which financial consumers/investorsimprove their understanding of financial products and concepts and, through information, instruction and/or objective advice, develop the skills and confidence to become more aware of financial risks and opportunities, to make

informed choices, to know where to go for help, and to take other effective actions to improve their financial well-being. 

Financial knowledge is the understanding of a series of facts about the use and management of money. People need to know a certain level of information to be able to make informed judgements and effective decisions. Financial knowledge is an important contributor to financial literacy. 

Education (or instruction) is the teaching and learning that provides New Zealanders with the ability to interpret information and assess advice. 

Information is a fact or series of facts that require interpretation and assessment.

 

 

Advice involves the provision of guidance or recommendations on financial direction. This excludes “advice” given by commercial providers for commercial purposes.