Abstract
In Australia, financial literacy is not given prominence within the education system, and it is a general view that financial literacy is gained through ‘hands on’ experience in earning and spending money; further, financial education seems to occur only when people take a loan or experience financial difficulties (Hajaj, 2002). This is not sufficient if people need to make informed decisions about their investments and, because of a number of social factors, it has become necessary to educate the majority of the adult population in Australia in Financial Literacy over a relatively short period of time. Given the large numbers requiring such an education, the seminar approach is being widely used, however is it effective? Drawing on the adult education literature, this study examined the effectiveness of the seminar approach by surveying adult participants in a Financial Literacy seminar. The survey found that while a majority of participants (50%) expressed none or weak financial knowledge prior to attending the seminar and 45% expressed that they only had a moderate rate of financial knowledge, a majority of 63% strongly agreed or agreed to the seminar improving their knowledge of the need for retirement savings. Furthermore, 58% of participants were either confident or very confident of being able to apply what they learned in the seminar to achieving their retirement savings goal. These findings suggest that the seminar approach was effective in educating adults and improved their level of financial literacy. Future research could investigate whether the level of financial knowledge gained during the seminar is retained over a considerable period of time.
Highlights
THE OBJECTIVE OF this paper is to examine whether educating adults through a financial education seminar would enhance their level of financial literacy
The effectiveness of the seminar was assessed through participants’ responses to two questions: (1) attending the seminar has improved my understanding of the need for retirement savings, and (2) how confident are you that you will be able to apply what you learned in this seminar to help you achieve your retirement savings goal? The data was analysed using independent samples t-tests to determine which, if any, of the independent variables of age and gender, influenced whether the Financial Literacy seminar was effective in imparting financial knowledge to participants
The findings demonstrate that the Financial Literacy seminar was effective in imparting financial knowledge to participants and assisted them in achieving their retirement goals and retirement savings decisions
Summary
THE OBJECTIVE OF this paper is to examine whether educating adults through a financial education seminar would enhance their level of financial literacy This is essential because the latest published life expectancy tables show that a 65 year old male has a life expectancy of 17.7 years and a 65 year old female has a life expectancy of 21.15 years (Australian Bureau of Statistics, 2006). These figures indicate that a substantial number of older persons will need to be supported by either the government or themselves during their retirement years. Many future retirees lack education in financial planning and retirement saving (McCune, 1998). Lusardi (2000) found that individuals who did not plan for retirement had lower new wealth and were less likely to be educated about appropriate investments such as not investing in assets with higher expected returns. Lusardi (1999) concluded that extensive information was required to plan for retirement and financial education programs were vital to the planning process
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