Financial literacy is falling in Australia, except that it’s not

• Observed financial literacy in Australia declined by 2016 and 2020 • The decline is attributed to an exogenous shift in interview mode • Measured financial literacy declined, not true financial knowledge • Mode changes can create spurious changes in cognitively demanding survey responses Using a nationally representative household panel for Australia, we observe an apparent significant deterioration in financial literacy between 2016 and 2020 and aim to identify its determinants. This surprising development is attributed to an exogenous change in interview mode from predominantly in-person to telephone, causally induced by the coronavirus pandemic. Measured financial literacy, though not latent true financial knowledge, declined as a result. Analyses of financial literacy or other cognitively demanding subjects must specifically take mode of interview into account, as mode changes can create spurious trends in cognitively demanding survey questions.