Sustainable finance literacy and financial well-being: a literature review

Sustainable finance transforms financial markets by changing what it takes to achieve a pre-defined outcome. The existing literature on consumer finance examines the relationship between financial literacy and financial well-being. However, the literature on sustainable finance literacy is limited. This chapter aims to review the existing literature on sustainable finance literacy and financial well-being. Firstly, a bibliometric review is been conducted by searching for relevant literature in an online database (Scopus) for over two decades (2000–2024) to account for the theories on financial literacy and financial well-being that emerged in consumer finance. Secondly, a narrative analysis is been conducted using the Theory, Context, and Methodology (TCM) framework (Paul et al., 2017) to identify potential avenues for further research. Future research needs to: i) deepen the difference between financial literacy and sustainable finance literacy, While the former does not appear to be significantly correlated with the likelihood of owning a sustainable finance product, the latter may potentially exhibit some correlation with certain dimensions of financial well-being; ii) demonstrate the benefits of a standard for sustainable finance products to contrast greenwashing and greenhushing; iii) deepen the methodological implications of open-ended questions and endogeneity; and iv) finally, close the gap between what investors perceive their investment to be and the actual product they have invested in.