Financial Literacy and Financial Stability
Crossan 2010 on her working paper stated that in New Zealand the public and private partnership give benefits for the country. One example of partnership
between public and private sector happened when private sector funding secured to transform the website that hosts the national strategy into a focal point for sharing
information on financial literacy. The main New Zealand banks also contributed funding to a pilot program which led to personal financial management module to a
nationwide parenting education program, giving the tools they need to make informed decisions about their budget and spending habits. This program combines
the bank financial expertise with the parenting education experience of the non- government organization NGO.
The existence of monitoring and evaluation body is also imperative in some scale to understanding what has worked and identifying lessons for how financial
education can best be developed in the future. To measure how effective the program is we can use surveys. We can conduct survey on how well people’s
financial knowledge trough the time. We can also monitor the website’ simpact which provide financial information through visits, user sessions and demographic
Crossan, 2010.
O’Connel 2009 suggested that there are three principles that should be kept in mind when considering financial literacy policy and practice. First, financial
literacy is complicated and multi faceted. It is likely that different types of education work in different ways for different people to improve different types of financial
literacy spectrum. Second, policy makers should be realistic in their expectations about the benefits of financial education and the impacts of improved financial
literacy, this is due to the effectiveness of financial education is unlikely to be proven in a simple causal way. Third, financial literacy is part of the policy mix, so that we
cannot rely on sole policy to create the condition we want, other approaches should be implemented to improve personal financial wellbeing.
4.
Conclusion
Financial education is touching different parts of people’slives at different times and in different settings. It means that strategies for improving financial
literacy must be multi pronged and multi layered. This brief article outlines the importance of financial literacy to help financial
stability, further it also highlight the strategies to improve financial literacy. Due to the economic integration through ASEAN Economic Community the fundamental of
financial education is important not only for those who live in the city but also people live in rural areas. With the growth of technologies there will be no
boundaries that separated the city and the rural areas, so does with access of financial products offered by financial institutions.
Developing quality of financial education is not enough because we also have
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to ensure that more and more people engage to the awareness of financial literacy, so that the development of national or even regional strategy for financial literacy is
important. The pursuit of public, private and not-for-profit organization collaboration also needed to support promotions for lifting financial literacy.
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