The formal education system is the best way to inculcate financial literacy into the next generation of young consumers, the Australian Securities and Investments Commission (ASIC) believes.
In a speech to the Australian Bankers' Association ASIC Chairman Greg Medcraft said instilling financial literacy in the next generation from an early age is a vital part of education in the 21st century, and is the top priority for ASIC .
Medcraft also stressed the need for quality, targeted support to meet the complex needs of the community, particularly disadvantaged and/or vulnerable consumers.
"This is an area where partnerships between community, business and government sectors have proved effective," he said.
Close at heels was the increased use of free, impartial information, tools and resources.
"Impartiality has also been widely recognised as an important feature of financial literacy information. Consumers prefer an impartial source to a partial one," Medcraft said.
Medcraft wants improvement in the research and evaluation of outcomes, especially because research from behavioural economics can help the industry understand why people make the financial decisions they do.
"It also informs communication strategies and how we design tools, to make financial decision-making less stressful and help people avoid common pitfalls," he said.
Also, educational programs could receive a leg-up through cross-sectoral partnerships, he said.
"Education is important because it empowers them when making financial decisions to take responsibility for themselves," Medcraft said.
The comments come a month after the launch of the National Financial Literacy Strategy 2014-17, through which ASIC aims to promote confident consumers and investors in the financial system, whether they are planning for retirement or investing in the market.
