Where to start when you don’t know where to start; financial literacy in an age of information overload

Welcome to Say What Wednesday – Today’s episode is a special one! Plus there’s a bit of an announcement at the end.

This all started with a question I asked myself a few years ago. The question is: How can I increase the financial literary of Australians?

The Back Story

• Started reading books about investing at age 12, played the ASX School Share Market Game as well
• Started investing at 16 years old, just before finishing school
• Went to Uni and did Commerce and Economics degrees
• Started in financial planning after graduating and never looked back
• I had a lot of financial knowledge, but my clients didn’t (which is why they were coming for advice!)
• I had a ‘Eureka!’ moment – most of the initial meetings I was having with clients was spent simply educating them on a few of the same basic principles. Teaching people was 60% of the job.
• Previously I hadn’t thought too much about the fact that people didn’t have the same background or exposure to finance as me;
  • I was pretty naive starting out – I assumed everyone would know at least the basics
  • But learned that financial education is lacking – it’s not taught at school or anywhere else in life unless you specifically seek out the education yourself

Education / Literacy

• You learn physics and chemistry and how to dissect poetry – but most people never use it again
• The point, I thought, of an education is to equip you to earn an income later in life.
• From there, people go into trades or go to Uni, but never learn what to do with their money
• What are your options then?
  • You either learn as you go – make some mistakes along the way
  • Someone does it for you
  • Or someone teaches you

There is plenty of information out there – But this comes with a few problems

1. Scatter gun approach to information / Information overload – where do you start?
2. No structured order to the internet in most cases
3. You don’t know what you don’t know – hard to search online unless you know what you are looking for
4. Most top-ranking searches are from the media / money making institutions – selling something, not providing education – a shiny quick fix

Creating a Solution

1. In 2014 I decided to do something about this problem
2. First step was to see where I could teach
3. Contacted the course coordinator from a community education provider, we met and they liked the idea
4. I locked myself away and started from scratch – I went back to the basics and thought about what information I would need if I was starting from day 1 all over again.
5. The end result was a 6-week course that I taught each semester for 2 hours a week, Wednesdays 7pm to 9pm.
   • Really enjoyed this, but it was limited in scope – plus people’s lives are busy and 7-9pm on a Wednesday night is a big commitment
   • Lots of people wanted to take the course – but couldn’t make it

An evolution

• After 2 years of teaching I had another eureka moment – almost the same time as Jayden and I started The Rentvesting Podcast
  • Why not put it online? You can do it your own time and there’s unlimited scope and online tools to use as well
  • So, over the past few months been putting it together in an online package – not restricted by school terms and 2-hour time slots and condenses all the information into modules that flow in a sequential order
    • The content ended up growing into 24 hours’ worth of lectures over 12 modules – I was running into same problem as before – information overload. Plus – there was so much information in there it was hard to get through.
    • So, after some initial feedback I scaled it back to just the essentials

The Announcement

• Lectures recorded for the essential finance course – gone from 24 hours to 7 hours of lectures
• To be completed through an online portal – go at your own pace
• Tools for each module and quizzes – no point learning if you can’t apply it.

What the course covers – 8 Modules

1. Financial independence and goals
2. Basics – Income, taxes, balance sheets, budgeting
3. Basic economics – Supply and Demand – Important for price of investments
4. Investment theory – Risk returns and diversification
5. Investment Basics – Different asset classes – How shares work, bonds, etc and asset allocation
6. Structures – where you can hold investments – Family trusts, super
7. Strategies – Focus on how to build wealth and reduce tax
8. Risk management – Long term plans need contingency – Investment risks and personal risks

For those who are interested go to https://financeandfury.com.au/learn-finance/

• Or just get to our website financeandfury.com.au, select ‘Learn Finance’ from the main menu, then scroll down to the bottom of the page to register your interest
• We are already getting a list of people together to contact when the course goes live – this course is only being released to podcast listeners
• Further details soon

Thanks for listening!