Here at Money101, we don’t need a reason to celebrate the power of lifelong learning, especially when it comes to personal finances – it’s part of our mission every day. But not everyone feels the same way. Chances are that (unless you’re a uni student) if you ask your friends and family how they feel about going back to study, they’d baulk at the idea. For lots of us, learning is synonymous with studying, going to school, sitting in a classroom – all the stuff we’re glad to be done with!
We decided two explore three facets of this: why most of us desperately need financial education, why starting something new can feel more intimidating than it should, and why it’s amazing to rediscover learning with the awesome technology and platforms we’ve got in 2017.
If these stats remind you of someone you know, show them this graphic and get them thinking about a kind of education they may not have known just how badly they needed.
But how will financial education help?
Nearly three quarters of us use online banking, over 50% pay online for goods and services, and 40% of us already use our computers and smart phones to compare financial products. So why not use the same devices to learn how to compare and choose products?!
There’s just so much information and opinion out there online, in the papers, and on TV. It can be hard to know what to believe or who to trust, which makes it difficult to make decisions and be proactive. Financial education can help cut through the noise and improve peoples’ confidence in their financial decision making. For example, one study found that financial education improved confidence by 40%.
We might buy ourselves the odd treat (or ten), but 90% of visitors to the MoneySmart educational site reported taking positive action on their finances as a result of their visit. That means things like budgeting and increasing their savings rates. Learning makes a difference!
The average Aussie spends 10 minutes per session on their phone, and a bit over half an hour per session on their PC. Luckily, there’s a form of financial education that only takes a couple of minutes at a time…
Financial education can have a big impact on people who often make impulsive purchases. For example, in one study, financial education made people around 50% less likely to be too impulsive to wait for a bigger financial reward down the track.
We’re always on the go
- Most Australians have a smart phone (65% of ‘matures’, through to 92% of ‘leading millennials’)
- 56% of people own a smartphone, laptop and tablet, and 86% own both a laptop and smart phone.
- 69% say that being able to watch content when they want is more important than the device on which they watch it.
There’s a lot of noise in the media
- Millennials vs boomers – who had it easier? (Example 1 // Example 2)
- Immigration and unemployment (Example)
- General cost of living rising, general wages stagnating (Example)
- Penalty rates cut (Example)
We love treating ourselves
- Aussies spend about 58% of their food budget on discretionary (read: junk) foods and drinks, including 14% on takeaways, and 4% on sugar-sweetened beverages like soft drink. (Amanda J. Lee, ‘Testing the price and affordability of healthy and current (unhealthy) diets and the potential impacts of policy change in Australia’ BMC Public Health 2016 16:315) // Media release
- Over half of all Australians buy new clothes at least once a month. (Roy Morgan Research, ”Experiences’ over ‘things’: Aussies spending more on leisure and entertainment, but less on commodities’ (Media release))
- Aussie workers spend around $1,548 a year on buying their lunch at work. (ING Direct ‘Cost of Going to Work’ (Reported here))
- Nearly 70% of Aussies eat chocolate at least once a month, including bars, blocks and boxed chocolates. (Roy Morgan Research, ‘More Aussies Chomping on Chocolate’ (Media Release))
We’re all time poor
- Nearly 10% of Aussies eat a frozen or chilled ready-made meal in any given week
(Roy Morgan Research, ‘More time-poor Aussies opting for ready-made meals‘)
- Nearly 300,000 Australians work 70 or more hours per week. (ABS 6291.0.55.001)
- Large households waste around $2,200 worth of fresh food a year because of poor planning and poor storage. (Samsung, Australians@HOME 2.0)
We live for now
- Australians spend more on experiences than things. (Roy Morgan Research, ”Experiences’ over ‘things’: Aussies spending more on leisure and entertainment, but less on commodities’ (Media release))
- Convenience store sales are growing faster than regular grocery store sales. (Sue Mitchell, AFR, ‘Fresh food, decent coffee fuel convenience store sales’)
- 75% of Australians don’t have a long term financial plan. (ASIC, EY Sweeney Research, ‘Australian Financial Attitudes and Behaviour Tracker, Wave 4: September 2015 – February 2016‘)
But how will financial education help?
- ANZ Survey of Adult Financial Literacy in Australia, May 2015
- Fernandes, Lynch, Netemeyer, ‘The Effect of Financial Literacy and Financial Education on Downstream Financial Behaviors‘ The Netherlands: Rotterdam School of Management, Erasmus University
- ASIC, National Financial Literacy Strategy Highlights Report 2016
- ‘The Mobile Story – Nielsen Mobile Ratings, Australia, September Preview Data 2015′
- DeHart et al, ‘The Effects of Financial Education on Impulsive Decision Making‘ PLoS One, 11(7): e0159561.