By Chuin Ting Weber, CFP, CFA, CAIA
CEO & Chief Investment Officer, MoneyOwl
Prof Annamaria Lusardi is a global authority on financial literacy When I had the privilege to meet her in the US while on the Stanford Executive Program one year ago, she said to me, “Financial advice is not a substitute for financial literacy.”
That is so true!
Education AND “last mile” solutions.
Both must function, like twin engines, for financial security.
Without a good grounding knowledge wise, we can get shaken in our financial journey, or never start.
But we also need to translate this knowledge into the right solution sets that are fit-for-purpose.
In Singapore’s context, this can even be a “no-cost” solution like our national retirement system, CPF, national insurance or just a saving habit or rubric, that forms the basis of our financial planning, without a single commercial product yet. And then among commercial insurance or investment products, a professional curation (that’s called advice!).
I’m heartened that in Singapore, many companies and managers increasingly pay attention to financial literacy PLUS the need to provide an off-ramp to action.
Also really happy that more than 20,000 follow MoneyOwl on Instagram, our main channel for financial literacy sharing, and I’m told financial advisers also use our material with their prospects and clients.
This new research by Prof Annamaria and the distinguished team at Global Financial Literacy Excellence Center (GFLEC) affirm how we can:
- Use stories to explain key concepts – even diversification. I extracted the stories in the comments, though you can download the full GFLEC paper for free.
- The need to help link up knowledge to behaviours. For me, I believe that key is in lubricating action and making it easy through good solution sets – a lot of potential for that with digital supremacy, as well as in the third point below.
- The need to have repeated touch points for education. It’s not a one-off lunch talk. This includes helping to interpret events and hold people through this so they don’t take actions that sabotage their family’s lives.
Let’s do this even for the many, including people who can’t afford to pay thousands for individualised advice or who don’t have a million dollars in assets on which good fees can be paid, and without having to use expensive solutions.
Between Government, educators, employers and industry, and ourselves, surely, we can make it work, especially in Singapore? 😊
