Date & Time: Tuesday, February 5th, 2019 4:00 pm - 5:30 pm
Venue: Room 105, Research and Lecture Building, Tokyo University of Foreign Studies
Speaker: Dr. Benjamin Amoah (Special Visiting Lecturer, Tokyo University of Foreign Studies, Japan / Lecturer, Central University, Ghana)
Title: The Truth behind Self-Assessed Financial Literacy and Retirement Planning
Report:
On the 31st Seminar of the African Studies Center (ASC), Dr. Amoah presented the results of his research conducted in three suburban areas of Accra, Tema and Dawehnya, in Ghana.
After a brief self-introduction, Dr. Amoah stated the main problem of his research: the common wrong self-assumption of high financial literacy in the context of a gradual global change of pension systems in which people are unprepared to individually seek for retirement plans due to financial illiteracy. The main objectives of his research were to test the gender differences in financial literacy, evaluate the level of retirement planning and financial securities and analyze the determinants of self-assessed and actual financial literacy.
The presenter mentioned five key factors that define financial literacy: awareness, knowledge, skill, attitude and behaviour necessary to make sound financial decisions and achieve financial wellbeing and based on data assessment, he asserted that: there is no gender difference in terms of financial literacy, that only 33% of the respondents had high level of financial literacy, 50% of the respondents had an average level, and 17% had a low level. He pointed remarkably that 70% of respondents couldn't differentiate savings from investment and most of them were risk averse. It was also among his findings that most respondents have good information on retirement planning and these individuals did a better self-assessment of their financial literacy.
To conclude his presentation, Dr. Amoah left the following recommendations: financial educators should be skeptical about individuals self-assessment; the ministry of education should make financial literacy compulsive at all levels of education; these financial literacy programs should focus on basic numeracy skills, ability to understand simple interest, compound interest, diversification and the effects of inflation; and Media, such as television, radio and newspapers should be used to educate the public.
The discussion section revolved around the factors that contribute to a higher level of financial education, reasons why Ghanaians are risk averse, how to identify fraudulent investment schemes, socio-cultural factors that affect financial literacy and questions regarding the methodology employed.