Millennials’ engagement with online financial education resources and tools - USA
The United States Global Financial Literacy Excellence Centre recently surveyed millennials (18-37 year old’s) to understand what motivates their engagement with financial information and what drives them to build their levels of financial knowledge. They found that of the 1,885 surveyed, a large majority (92%) frequently or sometimes seek out financial education resources, with the majority of these being online.
The researchers found that respondents who were more financially literate, were more likely to use informational websites, personal finance blogs and articles, while millennials who were less financially literate were more likely to access financial information via social media platforms.
Trust and perceived cost can be barriers for this group to access financial information online, with one-fifth of respondents noting that they lacked trust in financial education resources and almost one-third believing quality financial information is too expensive.
When making decisions about money, two thirds say they talked to their family and friends about money. Millennials that participated in a financial education course through school or work were more likely to talk with their relatives and friends about money matters. For a medium sized purchase like a bike or television, two-thirds of respondents went online to find information and perform tasks like compare prices. For larger financial decisions, such as buying a house or getting a mortgage, only one third looked online, with more talking to family and friends.
Money is still, however, a taboo for this group, with one third of millennials believing personal finance is a private matter and preferring not to discuss it with anyone – only 22% said they would enjoy talking about money in a group setting.
How families teach children about money – UK
Money & Pensions Service’s compelling qualitative research focused on how families teach children about money. They conducted interviews with 25 families across the United Kingdom to understand what financial education in the home looks like across different demographic situations and family circumstances; and to identify examples of good practice in terms of the strategies parents are using.
Some common lessons about money included:
- the importance of working to earn money
- that money should be used for worthwhile things
- you can make your money go a long way by budgeting and tracking spending
- that it’s good to put away money for special things and unexpected payments.
Some of the teaching methods the parents used included:
- involving children in household and everyday financial decisions
- giving children responsibility over their own money and
- role modelling good financial habits in front of children.
They also identified some common challenges:
- uncertainty about when to start conversations with their children about money
- the worry that parents’ actions and attitudes didn’t always reinforce what they were trying to teach their children about money and
- a lack of clarity about why it was important that their children develop financial capability behaviours.
Yarnin’ money report 2019
Back home, the Indigenous Consumer Action Network (ICAN) recently released its Yarnin’ Money evaluation report. ICAN was provided funding by ECSTRA in late 2014 to develop unique financial capability educational content to meet the needs of Aboriginal and Torres Strait Islander (ATSI) peoples.
The Yarnin’ Money program was developed with an intention to embed ATSI people’s cultural and knowledges framework into the design of the program.
The program involved a tailored training program to community service providers working across the vast geographic area of Far North and North Queensland, Cape York and the Torres Strait regions and a tailored community-based training program to local residents of these communities. A number of new tools were developed by ICAN including the use of a personal timeline – to understand where and how money fits into one’s own cultural worldview and how histories and life events impact our view and use of money.
Between 2015 to 2018, ICAN delivered 28 Service Provider and With the Mob training workshops to 272 participants covering 13 communities and regional areas of North Queensland, Far North Queensland and the Torres Strait. It has received financial support from the Commonwealth Bank of Australia; the Department of Social Services and; the Queensland Department of Communities, Disability, Services and Seniors. The Yarnin’ Money program has been integrated into the Indigenous Financial Counselling Mentorship Program and delivered to financial counsellors and capability workers from Queensland, WA, Victoria, NSW and South Australia.
The Melbourne Business School Retirement Ecosystem Research
Last but not least, the Melbourne University’s Business School has released two reports from research they conducted in 2018, investigating Australia’s retirement ecosystem. The first report – The Customer Journey Through Retirement Planning: Mapping the complexity of the Australian retirement planning – maps six steps along an ideal customer retirement journey:
- Selecting and managing one superannuation account
- Engaging with statements and online communication and making voluntary contributions when feasible
- Transferring the same super account whenever a change in employment occurs
- Seeking financial advice early on to set clear retirement goals and a means of achieving them
- Developing a retirement plan in pre-retirement phase and
- Converting to a comprehensive decumulation strategy with optional access to government support in later retirement.
The research showed that in reality a customer’s journey through retirement planning is very different for a variety of reasons including the precedence of life events over retirement savings – e.g. the impact of children, health issues, marriage and divorce.
The second report, The Australian Retirement Planning Ecosystem: Dynamics, tensions and opportunities, considers the ecosystem from the point of view of the individual and identifies the various organisations that consumers engage with through the retirement planning journey.
This research revealed a highly saturated and fragmented system, a feeling of disconnection and tension between government and industry and, a mindset of paternalism which can lead to further consumer disengagement. In developing a framework of the Australian retirement planning ecosystem, the researchers placed consumers on the outermost layer – reflecting their findings that the consumer is influenced by the collective actions of all the participants of the ecosystem.