Financial freedom is key to enabling Australians to achieve their dreams.
The Financial Freedom Index has been designed to measure how Australians are positioned to live a life of financial freedom – that allows them to achieve their dreams. Australians who score highly in the index are likely to be closer to achieving a sense of financial wellbeing in their life, as they are well positioned to being able to achieve their dreams.
About the Financial Freedom Index
The index measures the financial starting point for Australians and their level of financial literacy and education, their behaviours in terms of actions they are taking to realise their dreams and financial freedom, and their attitudes and mindset towards achieving their aspirations.
The following three key measures form the index and comprise 15 individual indicators. An average score is provided for each of the three measures, and the average across the three measures provides the overall Financial Freedom Index.
|Foundation measures the extent to which individuals are set up to move towards financial freedom and achieve their dreams, from their childhood experiences to their current financial literacy.
|Behaviour measures the extent to which individuals are set up to move towards financial freedom and achieve their dreams, from their childhood experiences to their current financial literacy.
|Attitude measures the degree to which individuals have a mindset that will help them flourish and move closer to financial freedom and their dreams, from how motivated they are, to how much they believe the dreams are realistic.
The inaugural score
The Financial Freedom Index can range from a score of 0 to 100. Anything above 50 indicates an individual is well positioned to achieve their dreams. There is more to be done to support Australians in their ability to achieve financial independence and help them reach their dreams, with a score of 49 out of 100 in the inaugural Financial Freedom Index.
The Index reveals Australians score the highest in their Attitude (59), followed by Behaviour (48) and Foundation (40).
This shows that while Australians could be better equipped in their foundational experiences (such as early financial education literacy), they have strength in their attitude and sentiment, which over time, could drive a positive improvement in behaviour.