Schooled in financial management

PHOTO: Schooled in financial management

When people learn that I am an old hand at financial reporting, somehow we end up talking about investment opportunities.

So recently, when I got an award from the Securities Investors Association of Singapore for outstanding commentaries, I was not surprised to find a note from an old classmate that ran as follows: "Eng Yeow, we have been reading of your broad-strokes so far. What we need is some hot tips, please."

I had a good laugh over his plea. Seriously, those who follow my columns will know that I consider making sound investment decisions to be extremely hard work which involves plenty of patience and research.

What I can safely say, however, is that having practised what I counselled in my columns, I have been able to build a nest egg in blue chips whose value has grown over the years as their fortunes brighten.

And to offer readers a handle on how I did it, I have compiled some of my columns into a book Small Change: Investment Made Simple. It is due to hit major bookshops in the new year.

In order to build a nest egg, there is no easy way out. A person has to get his basics right first - learn where his money comes from, whether it is from his salary or other sources of income, and how he is spending it.

A recent survey of more than 1,800 people commissioned by the Monetary Authority of Singapore shows that Singaporeans are generally quite careful about their finances. About 80 per cent save some money each month and 86 per cent do not like taking on debt.

But it notes that "quite a few people are passive towards managing their money". That may cause them problems if they fail to save enough or incur unforeseen expenses such as a big medical bill.

So I read with interest the initiative taken by the Education Ministry to roll out a new syllabus next year for Secondary One and Two students that would place greater emphasis on teaching them to manage their finances.

But I was curious to know why it was labelled "Food and Consumer Education" and taught during home economics classes which I have always associated with cooking and sewing. Surely, calling it financial education would have been more appropriate.

I phoned Dr Joyce Mok, the senior lecturer at the National Institute of Education, who was on the syllabus committee, to find out more. It turned out to be an enlightening one-hour conversation with an educator who was very passionate about the subject.

She told me that students will be taught how to spend within a budget, how to get the best value for their money - and more importantly, how to save and grow their money to ensure they will have enough of the important things in life.

Dr Mok noted that it would have been even better to teach students such skills at an even younger age.

But at least, the teachers will have a chance to teach students at the age of 13 or 14 to develop the right attitudes towards spending and saving, before their lives are crowded out by GCE O-Level and A-Level examinations.

I came away from this chat convinced that if she manages to infuse her teacher trainees with the same enthusiasm on financial education, they will in turn be able to inculcate in their young charges a vital life skill just as they are starting to use money.

For far too long, most children learn money management skills - both good and bad - at home, and this is inadequate.

With most married couples now working full-time to service their home mortgage and a host of other debts, the chances are that those who fail to rein in their spending may in turn set bad examples for their children.

Worse, consumers get the vast majority of their financial information from companies spending vast sums trying to promote an image or enticing them to take up products and services such as credit cards and various kinds of loans.

Statistics from Credit Counselling Singapore show that the people who find themselves in financial difficulties are not just low-wage earners but also those who earn $2,800 or more because they over-spend.

So it is imperative for a person to get at least the basics right on financial planning if he is to have a fighting chance of navigating his way through life without a serious financial mishap.

As a financial journalist who spends a lot of time promoting investor education, I salute the efforts of educators such as Dr Mok who spend their time trying to get the basics of financial management across to our younger generations.

Get a copy of The Straits Times or go to for more stories.