Last week I returned to Sydney from a trip to Hawaii for a friend’s wedding. Having not been to the United States for some time, I was shocked at the number of overweight people I encountered. When it comes to the obesity epidemic, because the visual evidence ‘lives large’, it’s impossible to ignore.
The US is not alone. Many of us can’t deny we have a serious health problem here as well. A staggering 60% of Australians are considered overweight or obese. By 2025 it’s believed that will be closer to 80%.
Not all epidemics are as obvious as obesity though. Right now, we are in throes of an invisible and insidious financial illiteracy epidemic, sweeping middle Australia. In many ways, we should be thankful the Royal Commission is ripping the band aid of this festering sore, exposing the depths to which this illiteracy infection has taken hold.
We lag the developed world in understanding basic financial concepts
Only 64% of Australians have basic financial literacy skills, according to The S&P Global FinLit Survey we lag behind the UK and the US. If the same was said about reading and writing skills, we would be up in arms. The fact we aren’t about this statistic is telling.
We’re leaving our youngest and most financially vulnerable behind
Between 2012 and 2015, a government report found average financial literacy rates amongst young Australians had declined significantly. We’re going backwards in a world where financial products are become more complex, and far harder to navigate. For those of us that understand compounding, the long term effects of this are the seeds of our next Royal Commission.
In 2018 money is still a taboo
A good number of Australians still consider talking about money a taboo – before divulging the state of our personal finances, we’d rather talk politics, religion, death or even our emotions. As a result, we don’t challenge the institutions, planners and advisors who know this, and prey on it. Our lack of knowledge and fear of offending, or looking idiotic, is making many of us too afraid to ask the niggling questions we should ask.
Education the only reform possible
More regulation, more watch dogs and more fines isn’t the long-term answer to this epidemic. To stop the AMPs and rogue planners the only true and long-lasting reform we should be campaigning for is to give the power back to the people. We need to educate first, advise second. We need to make it acceptable to question those in power, no matter what it says on the letterhead.
Zuper intends to be at the vanguard of this financial education revolution. For us, superannuation is the one thing we think everyone has to get right.
Already our free Fin Gym financial workshops at General Assembly are reinventing what it means to engage with your finances. It’s about no product pitches, no lame sales people, just open and honest conversation about money. If you feel like you’re ready to get your epidemic jab, we’ll be ready for you – get a ticket to our next event on May 7th.
A financially literate future is a richer one
The relationship between literacy rates and increased GDP is well researched and documented. What collective impact could we achieve as a nation if we lifted our financial literacy rates, by just a few percentage points? Nation building isn’t just about broadband infrastructure and hosting the Commonwealth Games. To protect Australia’s status as a first-world and progressive nation, we have an obligation to start improving our investment in our citizens, as much as we do the financial industries that only survive because of them.
If the Royal Commission has taught us anything so far, it’s that a little bit of knowledge can go a long way to ensuring we have a financially fit future. So if you think you might be the financial equivalent of ‘skinny fat’, get on that fiscal treadmill ASAP.
Take back control of your finances and get your ticket to this month’s free Zuper Fin Gym today!
CEO and Co-Founder at Zuper Superannuation. Loves fintech, writing, pilates, Campari and soda's and, as of 2018, marathon running.More