These weeks are often thought of as the most depressing of the whole year. Many people’s determination to keep New Year’s resolutions is waning. Some will be finding that the personal austerity measures they put into place to counteract the excess of the holiday season are biting hard. Debts can mount and lead to serious financial difficulties for all too many people.
Undoubtedly, these problems are often exacerbated by gaps in the public’s economic knowledge and confusion over how financial products work. In this article I would like to let you know more about how the Profession is working to help address the problem of how we can improve financial education and consumers’ financial capabilities. I will also touch on how we are looking at ways to help companies present financial information in a clearer and more informative way.
We believe financial knowledge is important from a young age. As a result, we will be working with the Personal Finance Education Group (PFEG), an independent charity helping schools to plan and teach personal finance in a way that’s relevant to students’ lives and needs.
In January 2013, the Profession will be hosting a forum with PFEG, which will include representatives from charities, community and consumer groups, education and the financial sector. In addition, we are considering some inter-generational research between PFEG and others to look at the differences in financial knowledge, attitudes and behaviours between age groups. PFEG is also keen for our members to volunteer in schools. I’ve done this and found it very rewarding and would encourage others to give it a go.
A good grounding in the application and use of statistics in schools is essential to everyday life and future education. That is why the Profession has linked with the Royal Statistical Society to sponsor a report entitled The Future of Statistics in Our Schools and Colleges, which will help promote the teaching of statistics.
The report, by education specialist Roger Porkess, focuses on how statistics is taught and learnt in schools and colleges in England, with some evidence drawn from Wales and Northern Ireland. It concludes that all students should be equipped with a working knowledge of basic statistics and an appreciation of how it affects their daily lives.
The report was launched at an event attended by around 80 educationalists and other key stakeholders in January. It has been published on our website and distributed to a range of opinion-formers.
This forms part of a wider campaign, in which the Profession aims to link with other stakeholders such as government, MPs and policy groups to promote the financial education agenda. You’ll be hearing more from us on this subject over the coming months.
We are also looking to the wider community and considering how the Profession can assist in improving general financial communications.
As actuaries, we are uniquely placed to contribute because of our technical expertise, wide-ranging industry roles and duty of care to society. The work of the Consumer Information Working Party has been invaluable in this area.
Last year, it produced a report that explored the information needs of different people at a variety of life-stages and how those needs could be better met. The report is enlightening and an essential read for anyone in the profession who has to draft communications for non-experts.
In January, I was happy to chair a workshop to discuss the working party’s findings. This involved a range of stakeholders, including the Department for Work and Pensions and the Financial Services Authority, and identified some tangible actions to pursue.
Another working group looking at financial education is the Sleepwalking into Retirement group, which focuses on the fact that many people have high aspirations for their quality of life in retirement, but are at risk of making significantly inadequate provision for that lifestyle.
I know our members are talented and knowledgeable enough to come up with creative and innovative ways to improve financial communication and education. In the initiatives we have started, we aim to make a significant difference in helping people to become far better informed and therefore in a better position to make good financial decisions that will stand them in good stead throughout their lives.
Jane Curtis is the president of the Institute and Faculty of Actuaries