Sets the direction for improving financial literacy in New Zealand and establishes a high-level framework under which financial education initiatives are co-ordinated and actioned.

Introduction

The vision outlined in this National Strategy is to equip everyone to ‘get ahead financially’. It sounds good, but what does it actually mean? And does ‘getting ahead’ resonate with everybody or is it just a pipe dream for some?

In putting together this document, we debated those questions at length.

The term ‘getting ahead’ holds different meanings for different people, but at its core it is about how we successfully navigate our way through products, choices, demands and needs across a lifetime.

The vision is about being equipped to be on the winning side of your decisions. It means knowing where you want to get to, what success looks like, and having a plan to get there.

One of the streams of work outlined in the strategy is ‘talk’. It’s about the benefits of talking about money. It’s not suggesting we boast about our income, or overshare on how much we think our house is worth, but that we gain the confidence to have the hard conversations and ask questions when we don’t understand. That may mean asking to see the paperwork and asking more questions before investing, or talking about debt and assets within a family or relationship.

Behavioural economics tell us that knowledge alone is not the determinant of success. Our behaviour is not always rational and we sometimes act in a way that is at odds with what we know.

It’s important that we recognise those complexities, lest we focus on simply telling people what they shoulddo, then stand back in surprise when they don’t do it.

To that end we are always seeking to better understand through research, both global and local, qualitative and quantitative, how to bring about sustainable change –change for life.

Recent research on scarcity concludes that worrying about money, how to feed the family and pay the bills, erodes mental bandwidth, confidence, energy and optimism. Building financial stability builds our own personal capability and allows us the space to plan our lives.

One of the strengths of KiwiSaver that became apparent in focus groups in 2013 was that it changed the way people felt about themselves and what they were capable of. They went from being ‘that person who is hopeless at saving’ to ‘that person who has $10k in an account’. It is a moment of success and an opportunity to feel successful, and in that sense it has an impact above and beyond the dollar sum saved

Another insight was the importance of knowing that success is aboutyourbest result and nobody else’s. It is easy to give up when everyone else seems so much further ahead, but in the words of Warren Buffett ‘no one knows who’s swimming naked until the tide goes out’ (in other
words the neighbour’s new car may just be a large loan on wheels). It’s an important message that only you can carve your own path, at your own pace.

And critically, success at an individual level builds success at a national level, both socially and economically.

The goal of the National Strategy is to bring us closer to that success, by galvanising and consolidating efforts, sharing knowledge, and providing a structure to talk about the work to be done.

It offers a clear articulation of goals and work streams, and reduces the need for the same but separate conversations, in small disparate groups, to get to the same point. Some of the goals are hairy and audacious, but that’s not a bad starting point.

There are many individuals, agencies, NGOs and corporates working on financial literacy initiatives across New Zealand. Bringing about sustainable behavioural change is a task that is huge, resource hungry and seemingly without end, but we have a better chance of success with collaboration.

Together, we can equip New Zealanders to get ahead financially.