Financial literacy is a crucial first step to achieving financial security. However, studies show that many Americans lack fundamental financial knowledge.
FSI members Martha Wilcoxson, CFP®, and Denise Barrows, a CPA and CFP®, want to change that. And while each navigated different paths to become financial literacy advocates, they have one common goal: providing money management education for all.
Their efforts align with FSI’s long history or providing education and programs to support financial literacy, an important part of the organization’s outreach mission.
A Moment of Clarity
Wilcoxson, Founder of Pueblo, Co.-based Wilcoxson Wealth Management, had a watershed moment years ago as a newlywed living in Australia. She wanted to buy a government bond, so she made an appointment to speak to a banker.
After arriving at the branch, the banker wavered, repeatedly looking at his watch. Eventually, he asked when her husband would be there.
“I explained that I was the one buying the bonds, and I knew exactly what I was doing,” she recalled. “He smiled politely and suggested I make another appointment and come back with him.”
The encounter was an aha moment for her, making it clear that segments of the population were underserved or even ignored by the financial services industry. But more than that, it taught her that knowledge is a way to be heard, respected and protected.
“A well-informed investor is the best defense against any bad actors in the financial industry,” she said.
A Dose of Reality
Barrows’ journey to becoming a financial literacy advocate began 20 years ago with a local high school program called the Reality Store. Students received a checkbook with one month’s salary based on their career choice. Then, they would visit different stations that represented essential and discretionary living expenses.
“Students had to choose between renting or owning, what kind of car they would buy and what utilities they would elect,” said Barrows, a financial advisor and partner at Barrows Trostle Advisors in Chambersburg, Penn. “It was very eye-opening for them. Some chose sports cars, and others would run out of money. They learned to make different kinds of choices.”
An Unconventional Approach
Meanwhile, Barrows’ firm began offering its own financial literacy advocacy through direct education opportunities for clients and their families and indirectly through food collection programs for two elementary schools.
“Our primary goal was to have fewer children go hungry,” she said. “We believe that if children can understand financial literacy, they might pass that knowledge to parents, particularly those from financially-stressed families who rely on school programs as a primary source of meals. Maybe if those families knew how to make better financial choices, there would be fewer hungry children.”
A Champion for All
Wilcoxson’s career includes working as a FINRA arbitrator. She has seen how inexperience and poor financial information could create and exacerbate money issues. One case between a client and advisor stood out.
“It was like they were speaking different languages,” she recalled. “The advisor assumed the client was so much more knowledgeable than they actually were. I don’t think it was necessarily a predatory situation. It was just a case where the client and advisor didn’t communicate very well, with neither taking the time to listen to the other.”
That piqued her interest in the ethics of decision-making and how she could continue to advocate for financial literacy. Wilcoxson pursued a doctorate in education from Creighton University and now is an adjunct professor in ethics at Colorado State University’s MBA program.
Financial Literacy’s Future
Technology has been both a boon and burden to the financial literacy movement. Apps can make budgeting and money management easier, but only if users engage with the information correctly. Meanwhile, the amount of information on the internet can make even a novice investor feel like they are Warren Buffett.
“There’s so much more information to keep track of, and while some of it is good, a lot of it is bad,” Wilcoxson said. “That’s why trusted sources are so important. You have to be able to sort the good from the bad.”
The key to financial literacy is starting early, advocates say. Yet less than half of the country’s 50 states require high school students to take a course in financial literacy.
“Understanding basic cash flow should be part of the education curriculum,” Barrows said. “Having access to some financial literacy education can really make a difference, which FSI has tried to promote through its educational events.”
There will always be a need for financial literacy, especially as investment opportunities expand and evolve.
“Individuals have to take ownership of their own resources and their own investments in the future,” Wilcoxson said.
We applaud Barrows and Wilcoxson for their efforts. Their financial literacy work underscores the positive change we can all make if we work together to tackle some of the most pressing issues in our industry and our community. Together, we can make a difference for all.