A Financial Literacy Workshop
BY TAN ZHAO KUANG
Earning money is hard, keeping money is harder. Financial literacy is a skill we all need in our daily lives, especially as we start earning money and taking up more responsibilities. The Holistic Development Portfolio is proud to present to you… Making Cents!
Everyone was ending their lessons and streaming in. As they registered their attendance, we provided dinner, and everyone was chilling around while we waited for the event to start. Ms Kris, our co-ordinator, and her instructors came early and began having an impromptu chit-chat session with the participants. This made the transition to the start of the event much smoother than originally planned.
She started by introducing her team and quizzing us on our basic financial knowledge. Seeing the varied income strata of the audience, and how many of us still do not plan for our finances, she brought awareness to the use of different financial tools, first and foremost being the use of spreadsheets and budgeting applications to help us record, analyse and project income and expenses. She showed us that not only can financial budgeting be important, it can be fun too!
Next, we played a small game on cashflows, My Singapore Guy/Gal. This was a game where scenarios were picked randomly by us, and the co-ordinators gave commentary and linked these scenarios to financial literacy habits. Throughout the game, it was emphasised that the current trajectory of our current spending habits will greatly influence the growth of our money. As the adage goes, “All good habits should have started yesterday.” The earlier we start planning and budgeting wisely, the more secure and stable our income will be in the future. The game also showed how money gets easier to save and to earn the higher your capital is and thus it’s best to start saving as early as possible.
There were smiles and laughter all around amidst the games. There were scenes where we all laughed at other people. Some iconic quotes include:
“I got pregnant.” – Hou Yi
“I got into a car accident for the third time in a row. (facepalm)” – Weien
“I married twice!” – Kai Xin
“I won the lottery!” – Luo Lin
At this point in our life, significant life events are becoming more frequent, and changes to our income and expenses becomes apparent. This can include remitting money to our parents and giving ang paos at weddings. Unexpected outcomes, especially so in the case of illness, occur very frequently, and we should be prepared for it. The importance of having good financial literacy became apparent as the game continued.
After that, we came to the segment about investing, and how we could make better use of our money, if we so wish to. She started with sharing of the causes of inflation, how money devalues and how interest rates in traditional methods will almost always guarantee a loss. It’s always better to diversify our income and explore searching for higher returns if we do not want our money to stagnate. The trade-off and risks between different methods were discussed and the amount of effort needed to start and continue these investment methods were discussed. The higher the returns, the higher the risks, and the more effort one has to put in. This segment was interesting. However, although there is much I can do, I don’t think I will change anything significant and start investing heavily. Nonetheless, this has opened me up to different perspectives, and brought awareness of alternatives I could look into if I so desire.
We concluded with a Q&A session and this surprisingly led to some very interesting discussions. For instance, Gary shared about how he had chosen to invest on the companies, and how his investment interests changed over the years. He shared his experience on how building up a credit rating from a young age is very useful in securing loans that he had needed. As undergraduates, we have many opportunities to make use of, for instances a credit card with a very low drawing limit. This will not only build our responsibility to pay on time in a safe manner, it also can help build up our credit rating. Furthermore, this will also aid us in recording our expenses, given the increasing prevalence of cashless payments. Nonetheless, he also warned of the high interest rates and how scary it can be compounded over time. This is not a task for the chronically irresponsible person. Ms Kris concurred.
Truly, the world is your oyster when we talk about getting more financially literate and there is so much to do. If one has the time, one shouldn’t hesitate in trying to explore more on financial literacy and make use of the resources available!
The Holistic Development Portfolio is very grateful for the participation of everyone. Overall, we hoped that this workshop served as a good platform for scholars to be more aware of their options, and together, we can start Making Cents!