Money know-how put to test

The country's economic savvy is to be tested with the start of New Zealand's first financial literacy survey.

Launched yesterday by the Retirement Commission and the ANZ Bank, the survey aims to assess the financial knowledge and money skills of New Zealanders.

ANZ managing director of retail Steven Fyfe said he expected most people to find their financial knowledge not as sharp as they expected.

Retirement Commissioner Diana Crossan said a lot of adults tended to bluff their way through money talk.

"Although adults can talk about the concepts, we don't know if they really understand what they mean," she said.

The survey will test understanding of concepts such as the difference between debit and credit cards and fixed and floating mortgage rates through to questions on forms of interest, tax and investment.

The results, due in the middle of next year, will help banks to gauge areas of customer confusion and improve services.

In the past anecdotal information or United States research has been the basis for such reviews.

Crossan said the findings would help educators develop programmes to improve the way people manage their money, and would feed into the commission's school project, which is exploring ways to introduce more financial education.

The survey would also provide a benchmark of financial literacy levels for future comparison.

Crossan said she hoped to see the survey repeated every five years.

Fyfe said the test would be similar to one carried out among 4000 Australians last year, and the cost would be in the "hundreds of thousands" of dollars.

It will be co-funded by ANZ bank and the Ministry of Economic Development.