Media Release 30 June 2008

Benchmark strategy sets direction for improving financial literacy

Retirement Commissioner Diana Crossan today welcomed the release of the National Strategy for Financial Literacy, a benchmark strategy which sets the direction for improving financial literacy in New Zealand.

Led by the Commission, the development of the Strategy was first announced at the inaugural Financial Literacy Symposium in Wellington in December 2006. Less than a year later, with wide support and involvement from public, private and voluntary sectors, a draft National Strategy was launched. A consultation process earlier this year resulted in 34 positive submissions from organisations across the country.

“We are delighted that we are now ready to go live with the Strategy. One of the first in the world, its rapid development shows the significance that we have placed on the need to create a more financially savvy population,” said Ms Crossan.

Ms Crossan said that in today’s fast-changing world there are many factors that mean a high level of financial literacy is more essential than ever before.

“People are faced with a huge range of financial decisions, from how to manage debt through to home ownership and how to pay for education. They’re also faced with an increasingly complex range of financial products and it can be overwhelming.”

The National Strategy indicates a range of tactics from the recent inclusion of financial education into the school curriculum, getting rid of financial jargon, encouraging financial education in the workplace, and continuing to provide information and tools to help people make informed decisions about their money.

“It sets a direction for us to collectively achieve our goal of personal financial wellbeing for New Zealanders,” said Ms Crossan.

Members of the National Strategy’s inaugural advisory committee also welcomed today’s release.

Governor of the Reserve Bank Alan Bollard said “Financial literacy is an important life skill for all New Zealanders. The Strategy is a positive foundation for us to build on as we work towards this goal.”

Chair of the Investment, Savings and Insurance Association Sean Carroll said that the Strategy is widely welcomed by the financial sector. “It’s an important step towards helping New Zealanders understand their financial situation so that they can confidently make informed decisions throughout their lives.”

The advisory committee, which will report annually to Parliament via the Retirement Commission, comprises Diana Crossan (Retirement Commissioner), Alan Bollard (Governor, Reserve Bank), Sean Carroll (Chair, Investment, Savings and Insurance Association), Jane Diplock (Chair, Securities Commission) and Karen Sewell (Secretary for Education).

Ms Crossan said that the Retirement Commission is well placed to lead the Strategy. Since 2001 one of the goals of the Retirement Commission is to ensure that New Zealanders are well educated in financial matters and can make informed financial decisions throughout their lives. The Commission is best known for its free, independent and impartial website sorted.org.nz which contains financial information and tools for all New Zealanders from five to 95.

A full copy of the National Strategy for Financial Literacy together with a summary of recommendations is available from the Retirement Commission’s website retirement.org.nz.

ENDS

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