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 211 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. References Asian Development Bank. 2013. Asian Economic Integration Monitor. Cole, Ethan Cohen et al. 2010. The Financial Sector and the Real Economy During the Financial Crisis: Evidence from the Commercial Paper Market. SSRN Electronic Journal 11. Crossan, Diana. 2010. How to Improve Financial Literacy: Some Successful Strategies. Pension Research Council Working Paper . Pensylvania: The Wharton School. Demirguc Kunt and Leora Klapper. 2012. The Little Data Book on Financial Inclusion. The World Bank. Lukonga, Inutu. 2015. Islamic finance, Consumer Protection and Financial Stability. IMF Working Paper . Lusardi, Anamaria and Olivia S Mitchel. 2008. Planning and Financial Literacy: How do Women Fare? American Economic Review: Papers Proceedings 98: 2, 413- 417. Lusardi, Anmaria. 2009. Overcoming the Saving Slump: How to Increase the Effectiveness of Financial Education and Saving Programs. Mandel, Lewis and Linda Schmid Klein. 2009. The Impact of Financial Literacy Education on Subsequent Financial Behavior. Journal of Financial Counseling and Planning 20. Mastercard Financial Literacy Index Report. 2014. O’Connel, Alison. 2009. Financial Literacy in New Zealand. Working Paper prepared for the New Zealand Government Capital Market Development CMD Taskforce . CMD Taskforce: Wellington. Singh, Upendra. 2014. Financial Literacy and Financial Stability are Two Aspects of Efficient Economy. Journal of Finance, Accounting and Management 52, 59-76. Soskic, Dejan. 2011. Financial Literacy and Financial Stability. Proceedings Bank of Albania 8 th International Conference. 212 Van Rooij, Maarten et. al. 2007. Financial Literacy and Stock Market Participation. NBER Working Paper No. 13565. Zizek, Slavoj. 2011. Living in the end times. Verso Books: London. 213