International Journal of Management, Knowledge and Learning, 4(2), 241–255 Financial Literacy of First-Year University Students: The Role of Education Francka Lovšin Kozina University of Ljubljana, Slovenia Nina Ponikvar University of Ljubljana, Slovenia This paper presents an insight into the characteristics of how students man- age their finances and their general financial literacy. The study was carried out by surveying 259 students from two different faculties. Students from the study programs with economics subjects were statistically better at defin- ing inflation, liquidity and real income. Statistically significant differences be- tween courses were seen also in the area of investment decisions, busi- ness students prefer riskier investments like an investment in bonds or gold, whereas non-business students prefer saving the money in a savings account. The results show that students who had economics content in their program more often state they control their finance and have on average better finan- cial knowledge. The results suggest that participation in economic/financial courses increases financial literacy and also feelings of mastery of financial areas, which is important to transfer knowledge into the practice. Keywords: financial literacy, financial management, education, knowledge, Slovenia, students Introduction Improving the ability to understand finance has become an important focus of state-run educational programs in several countries. The importance of financial education has grown in recent years as a result of financial mar- ket developments and demographic, economic and policy changes. More sophisticated financial markets and a greater variety of credit and savings instruments, together with increased life expectancy, hold important con- sequences for people saving or investing for retirement, for the users of credit, and all other consumers (OECD, 2006). In addition, financial literacy and financial education have been found to be strongly positively associated with household wealth (Behrman, Mitchell, & Bravo, 2010). Although only a few financial education programs have so far been evaluated, the results are encouraging since they have been found to be reasonably effective. However, academic analyses provide ambiguous results, finding no firm evidence of the measurable success of financial www.issbs.si/press/ISSN/2232-5697/4_241-255.pdf