10 June 2013 – For three consecutive years, the Johannesburg Stock Exchange (JSE) has run the National Youth Financial Literacy Day (NYFL) in conjunction with South African financial institutions and organisations with the aim of increasing financial literacy among the youth.
This year’s National Youth Financial Literacy Day event, will take place in two regions, Pretoria at Ditsong National Museum of Cultural History on 13 June 2013 and in Kwa-Zulu Natal. Both events are targeted at high school pupils, university students’ young entrepreneurs and other youth. The workshop will cover a range of topics including; Diversify your Investment Portfolio Using Exchange Traded Funds, Attaining Financial Freedom through Life Planning & Debt Management and Protect & Maintain a Healthy Credit Status.
Ingrid Goodspeed, Chief Director: Financial Sector Development at National Treasury will be the key note speaker. Other speakers on the day will include the Johannesburg Stock Exchange, National Credit Regulator, Financial Planning Institute and Mamepe Capital.
South Africa continues to rate poorly in terms of savings among adults and youth. The Banking Association released stats saying approximately 70% of adult South Africans do not save. Youth make up 52% of the total population therefore behavioural change of the youth has to be influenced from an early age.
The financial literacy baseline study undertaken by the Financial Services Board in the second half of 2011 (www.fsb.co.za) revealed some interesting statistics about young people aged 16 -19 years:
o the majority of young people (51%) would prefer to spend money than save it
o the majority of young people (55%) never enjoy dealing with financial matters
o young people are least likely to stay within their budgets
o young people are most likely to have no idea at all or do not know how much spending money is available
o young people are significantly less financially literate than the older age groups.
National Treasury believes, “young people who grow up understanding money and financial matters will thrive in life. Financial literacy is a critical requirement for modern life and the sooner our youth acquire good money habits the better. Young people need to understand the difference between what they need and what they want; the importance of savings and the need to start saving when they’re young; how to manage their money and use debt responsibly (for example do not accept store and credit cards when they have no means to repay them) and deciding whether and how to invest in university or higher education”.
“The information provided at the event will ensure youth have the necessary knowledge to make informed decisions and highlight the importance of saving and investing to leave a lasting legacy. The National Youth Financial Literacy Day also aims to expose the youth to the investment markets which will enable them to have sound financial habits,” says JSE Zeona Jacobs, JSE Director: Issuer Services and Investor Relations.
“As the professional body for financial planners in South Africa we are committed to ensuring that all consumers are exposed to financial literacy, particularly young people. It is for this reason that we are delighted to be involved in this immensely worthy initiative of the JSE. We believe that it is largely through initiatives such as these that the public can be exposed to the benefits of proper financial knowledge at a young age and look forward to continued involvement in the years to come,” adds Sankie Morata, Chairperson-Elect of Financial Planning Institute.
According to Alfred Matsimbi, Education and Communication Officer of the National Credit Regulator, “It is of critical importance for all South Africans, young people included to know their financial and credit responsibilities and also their rights as spelled out in the National Credit Act (NCA), Act No 34 of 2005. This piece of legislation (NCA) was enacted by the Parliament of the Republic of South Africa to promote and advance the economic welfare of consumers. Among other things the act also protects consumers against reckless credit granting, it prohibits unfair credit and credit-marketing practices, it regulates interest rates and fees charged by credit providers and it also give the consumers the rights to request credit agreements and contracts to be written in a simple and understandable language of their choice.”
Mauwane Kotane, MD of Mamepe Capital adds, “our youth have the power in their hands and it is important that we instil the importance of them investing from a young age.”
“It is the responsibility of all financial institutions in South Africa to prepare youth to make sound financial choices. The decisions they make today will impact their future tomorrow. The JSE hopes the initiative goes a long way in ensuring this,” concludes Jacobs.
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