New National Financial Literacy Strategy revealed

The financial services regulator has released its new National Financial Literacy Strategy for 2018 that seeks to “strengthen the financial capabilities of all Australians with the aim of improving financial outcomes”.

According to ASIC, this type of strategy is important as “it is clear that Australians need the know-how to understand and negotiate the financial landscape, manage money and financial risks effectively, and avoid financial pitfalls”.

The document, which is now open for consultation, aims to bring together stakeholders such as government agencies, community organisations, the education sector and financial services firms to focus on behavioural change.

Particularly, the 2018 national strategy seeks to help Australians manage their money day to day, plan for the future and make informed decisions.

The regulator found that while nearly every Australian holds one or more financial products, 42 per cent do not feel confident about managing their money, 36 per cent say they find dealing with money stressful and overwhelming, and 21 per cent have difficulty understanding financial matters.

As such, ASIC has released the said national strategy for 2018 to provide the “framework to guide policies, programs and activities that aim to strengthen Australians’ financial literacy and capability”.

The regulator proposes:

- extending the time frame of the next National Strategy to up to 10 years

- updating the language of the National Strategy from “financial literacy” to “financial capability” to reflect a growing focus on behaviours that support better financial outcomes

- expanding the priority audiences; for example, to include people with disability (and their families or carers) who are navigating choices and options under the National Disability Insurance Scheme, or people newly arrived in communities who are attempting to understand and access financial services

- broadening stakeholder reach and engagement with the National Strategy, including through the use of new technologies

- improving research, measurement and evaluation

Speaking of the strategy, ASIC deputy chair Peter Kell said: “Building financial capabilities requires a long-term commitment to lay the foundations for behavioural change over time. We all confront significant financial decisions at key points in our lives, such as leaving school, having children or reaching retirement.  

“To help people develop healthy financial habits and make better decisions about money, we're seeking feedback on the National Strategy.”

Interested stakeholders are being urged to provide a submission to ASIC by Friday, 17 November 2017.  

[Related: 2 in 3 Aussies don’t understand comparison rate]

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Annie Kane

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