The S&P Global Finlit Survey asked adults in more than 140 economies to answer questions covering four key aspects of financial literacy: knowledge of interest rates, interest compounding, inflation and risk diversification. In writing about the survey, researchers described the findings as “sobering.” Worldwide, just one in three adults were judged to be financially literate.

The United States was better than average, with 57% of adults being financially literate. Still, this puts the U.S. at just 14th globally. Norway, Denmark and Sweden all had financial literacy rates of 71%. Other countries with higher rates include Canada (68%), Germany (66%), Singapore (59%) and the United Kingdom (67%).

Americans largely answered a question about interest wrong, with only 40% giving the correct answer. This is despite the fact that the U.S. has among the world’s highest usage of credit cards. Out of the 67% of U.S. adults surveyed who have a credit card, just 57% were able to correctly explain the concept of compound interest.

A large gender gap also exists in the U.S. About 62% of men are financially literate, compared to 52% of women. The global gender gap is half of this size.

An age gap was also observed. Financial literacy rates were the lowest among adults older than age 65 in both the major advanced economies and the major emerging economies. It is unclear what, if any, role declines in cognitive abilities played.

Education has an influence, but income less so. In the major advanced economies, 52% of adults with at least nine years of education were judged to be financially literate, versus 31% of those with eight years of education or less. Financial literacy rates were higher among the wealthy in richer countries, but no income gap existed among countries with a GDP (gross domestic product) per capita of $12,000 or less.

Globally, inflation and numeracy (interest rate calculations) are the most understood. Risk diversification is the least understood: 64% of respondents in the major advanced economies answered the diversification question correctly, versus 28% of those in the major emerging economies. Not surprisingly, citizens of countries with past episodes of hyperinflation showed a better understanding of inflation.

Source: “Financial Literacy Around the World,” Leora Klapper, Annamaria Lusardi and Peter van Oudheusden, McGraw Hill Financial.