The report, International Approaches to Progressing Financial Capability^[1], by Social Ventures Australia (SVA), looks at international trends in financial literacy and capability, and identifies key ideas and approaches that may be relevant to the Australian context.

This includes the widespread development and adoption of National level strategies, with the report stating that “more than 70 countries and economies worldwide, including the majority of G20 nations, were designing or implementing National Strategies for financial literacy” as at 2020.

However, in contrast to many OECD peers, Australia’s National Financial Capability Strategy is currently inactive.

“Despite the efforts of a broad range of stakeholders focused on financial capability activities, Australia’s financial literacy levels^[2] are not improving, particularly among younger people. There is a risk we could fall behind globally if action is not taken,” says Caroline Stewart, CEO of Ecstra.

“This is particularly concerning against a backdrop of cost-of-living pressures, as Australians are navigating multiple challenges, economic inequality and the continued proliferation of financial scams.”

Louise Campbell, director of SVA Consulting, says” “Our environmental scan and analysis shows these challenges are not unique to Australia and there are tangible ways to address a range of issues.”

The research identified five key opportunities for Australia:

1. Recommit to a National Strategy for financial literacy and capability – including concrete goals and targets, sustainable funding and outcomes measurement.
2. Map stakeholders, initiatives and funding to better understand the financial capability ecosystem and to identify gaps and opportunities.
3. Convene stakeholders to ensure collaborative action. This includes community and consumer organisations, educators, academics, peak bodies, philanthropic partners, industry and government.
4. Ensure students have access to quality, evidence-based financial education in all schools across Australia.
5. Continue to engage in international initiatives addressing financial capability (e.g. PISA, OECD International Network on Financial Education).

Ms Stewart notes: “National strategies are complex, long term public policy projects. Given the many drivers of financial capability, the range of players involved and policy intersections, government leadership is critical for setting a clear, unified vision and roadmap.“

Ms Campbell agrees that the role of strong leadership cannot be understated when “the complexity of stakeholder coordination was raised as the greatest challenge across all jurisdictions. Clear leadership and effective coordination of activities and policy alignment is a success driver for better financial literacy outcomes.”

Simple, effective actions many countries have already taken include mandating dedicated financial education in schools.

In the US for example, 35 states now require students to take a personal finance course to graduate from high school. The New Zealand government recently announced its intention to make financial literacy compulsory in schools from 2025. This follows trends in many Nordic countries, where financial education is mandatory and higher overall financial literacy rates have been achieved.

Ms Stewart says: “Ecstra runs the largest face to face financial literacy program offered in schools across Australia however a whole systems change approach is needed. We reiterate our call for the government to lead a national financial capability action plan that includes elevating the importance of financial education.

“There are many stakeholders working on financial capability and wellbeing. This provides a strong base for championing a renewed approach to building financial capability to improve the lives of all Australians.”

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Notes:
[1] https://www.ecstra.org.au/news/ecstras-releases-research-report-international-approaches-to-progressing-financial-capability
[2] 2022 Household, Income and Labour Dynamics in Australia (HILDA) Survey

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The latest appointments expand the number of dedicated actuarial staff employed in the team to 30, one of the largest teams in the industry. Russell’s actuarial consulting business has been at the forefront of innovation in assisting large corporate superannuation funds and public sector schemes – particularly supporting clients in managing their defined benefits liabilities. Russell actuaries consult to seven of the ten largest Australian corporate superannuation funds, as well as some of the largest institutions in the country, and provide advice to more than $80 billion of superannuation savings.

Russell Chief Executive Asia Pacific, Alan Schoenheimer, said: “The traditional role of the actuary is changing driven by the complexity of regulatory demands and uncertain investment markets. This has resulted in a reduced focus on number crunching and an increased focus on a more collaborative problem-solving approach.

“Russell is a multi-asset retirement solutions specialist and our actuarial consulting capabilities help us deliver the outcomes our clients demand,” Mr Schoenheimer said.

“As an asset manager, you can’t manage investments to a specific outcome unless you have a clear understanding of the potential risks you’re facing, and how to manage and mitigate those risks. Our actuaries provide critical information and advice.”

Ms Campbell’s promotion recognises her ongoing contribution to staff and client management since joining Russell in 2009. Ms Campbell has over 20 years’ experience in superannuation and benefits consulting. Prior to joining Russell she spent 18 years with Watson Wyatt (now Towers Watson).

Mr Buttler has more than 30 years’ superannuation and actuarial experience. He was previously a senior consultant at Rice Warner and prior to that an associate director at Deloitte. At Russell, Mr Buttler will focus on actuarial consulting to large complex defined benefit funds.

Ms O’Halloran also has over 20 years of superannuation experience with an intimate knowledge of the management of superannuation schemes. Ms O’Halloran will focus on insurance arrangements for Russell’s clients.

“Russell is focused on helping our clients reach their real goals. These appointments strengthen Russell’s capabilities to deliver multi-asset retirement solutions that respond to the changing market conditions” Mr Schoenheimer concluded.

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