Digital finance skills tied to lower retirement anxiety in Japan study

Practical skills for using digital financial services may matter more for retirement confidence than basic money knowledge alone, according to a Hiroshima University-led study with Rakuten Securities. The findings point to a gap in traditional financial education as investing, banking and financial fraud risks move further online.

The researchers analyzed survey data from 94,695 Japanese retail investors ages 40 to 64 who were active online securities users. The study, published in the International Journal of Financial Studies, examined how parts of digital financial literacy were associated with respondents’ self-reported anxiety about life after age 65.

Hiroshima University said the work used the 2025 wave of the “Survey on Life and Money,” an online panel survey run jointly by Rakuten Securities and the Kadoya Lab at Hiroshima University. The survey was conducted in January and February 2025 among securities account holders ages 18 and older who had logged into their accounts at least once in the previous year.

Yoshihiko Kadoya, a professor at Hiroshima University’s Graduate School of Humanities and Social Sciences, said the team compared the role of conventional financial knowledge with more applied parts of digital financial literacy, including practical know-how, attitudes toward finance and self-protection.

Basic knowledge was not the strongest link

Financial education has often centered on what researchers call the “Big Three” concepts: interest rates, inflation and risk diversification. Hiroshima University said that kind of knowledge remains relevant because financial literacy has been associated with better retirement planning and less anxiety about old age.

In this study, however, the researchers found that overall digital financial literacy was negatively associated with old-age anxiety, while the strength of that relationship varied by component. Once the team separated digital financial literacy into eight parts, the traditional knowledge component did not show the same consistent negative association with anxiety when other digital competencies were included.

Practical know-how, positive financial attitudes and self-protection showed more consistent links with lower anxiety, according to Hiroshima University. Kadoya said the findings do not make traditional financial knowledge irrelevant, but suggest that education in digital finance should include the ability to use services, make decisions and guard against online risks.

The researchers interpreted the results through an “awareness–actionability” perspective. Hiroshima University said basic financial concepts may help people recognize risks tied to retirement, including inflation, market volatility and longevity risk, while anxiety may remain if people do not feel able to act on that knowledge in online financial settings.

Limits to the findings

The authors cautioned that the study shows associations, not proof that digital skills reduce anxiety. Hiroshima University said the data were cross-sectional, the participants were digitally active securities account holders rather than a representative sample of the general population, and old-age anxiety was measured with a single survey item.

The study’s authors said future longitudinal or experimental research would be needed to test whether improving practical and protective digital finance skills can reduce anxiety over time. For policymakers and financial firms, Hiroshima University said the results suggest education and customer support may need to go beyond giving users more information.

Kadoya said financial education should expand rather than replace traditional knowledge, with the aim of helping people understand concepts, use digital services, make sound decisions and protect themselves from fraud and other online risks.

This story draws on original reporting from Phys.org.