Reassessing the Role of Financial Knowledge and Confidence for Financial Outcomes Across Income Groups in the EU

Piotr Bialowolski, Dorota Weziak‐Bialowolska and Andrzej Cwynar

Kyklos, 2025, vol. 78, issue 4, 1424-1439

Abstract: This research utilizes Flash Eurobarometer data (N = 26,139) collected in 2023 from 27 EU nations to examine the link between financial knowledge, financial confidence, income, and financial outcomes. The findings reaffirm positive correlations between these factors and the examined financial outcomes. Notably, financial confidence often shows a stronger association with the likelihood of achieving financial outcomes than objective financial knowledge, particularly in areas such as long‐term financial goal setting, retirement planning, and confidence in financial advisors. The study also highlights that the likelihood of achieving financial outcomes is rarely more linked with financial knowledge or financial confidence among high‐income individuals than among low‐income ones. These findings underscore the possibly critical role of income in achieving positive financial outcomes and suggest that improving financial well‐being may require a multifaceted approach. A combination of financial education, income‐support policies, and initiatives to build financial confidence may represent an effective policy mix for improving overall financial well‐being across diverse income groups.

Date: 2025
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