online education

Monetary schooling: 4 classes to discover ways to save

Posted Sep 27, 2022 5:57pmUpdated September 27, 2022 at 6:37 p.m

How can you effectively manage your savings and investments? That’s the question that will occupy certain students for three weeks, about an hour and fifteen minutes a week. These are Internet users who have signed up for free online training provided by the Financial Markets Authority (AMF) and the National Consumer Institute (INC), publisher of the magazine 60 Millions de consommateurs.

The education team includes Claire Castanet, Director of Saver Relations and Protection for the AMF, and her assistant, Florence Corne.

30,000 visitors

Registration has been open since July 29 and classes will begin October 3 during World Investor Week. This is the third edition of this training, open to all, with no prerequisites. The first session started in 2020. According to the Autorité des Marchés Financiers, 30,000 savers took part during the first two editions.

This training includes four main topics: the role of the investor, their profile and objectives, the key concepts related to stock market investing (such as investment horizon, diversification, the risk/reward trade-off), how the key investments work, and a module to learn how to spot cheating.

“Each module consists of several videos and supplementary documents. It can be completed in one to two hours and concludes with a self-correcting quiz that determines the success of the course,” emphasizes the AMF. Students who have answered at least 50% of the questions correctly will receive a follow-up certificate at the end, which can be attached to a CV, for example.

The French are dissatisfied with their financial culture

This initiative responds to an issue that authorities regard as important, even worrying: the lack of financial literacy. According to a study published in December 2021 by the Banque de France, almost 7 out of 10 French people consider their financial culture to be average or weak. Among the least understood concepts are inflation and interest rates, two indicators that have nonetheless been the focus of concern for politicians and monetary authorities since the outbreak of war in Ukraine.

In his study on investor behavior and choice, the second part of which was presented on September 27th(1), the international asset manager Schroders also points out a lack of financial knowledge, even among wealthy clients. The peculiarity of this survey is in fact to focus on investors who need to invest at least 10,000 euros in the next 12 months.

hubris

Thus, this study shows that investors who consider themselves moderately financially savvy are misleading about their abilities. In fact, in the test given to them as part of the Schroders survey, they do little better than savers who describe themselves as newcomers. In detail, 89% of the answers given by the French respondents who consider themselves “moderate” are incorrect, while 90% of those who consider themselves “beginners”. Regardless of nationality, this excess of self-confidence is also confirmed.

“However, finance is not rocket science,” says Yves Desjardins, Schroders’ Managing Director France. We only invest savings in companies or in government bonds.” According to him, “we could start by giving one hour of classes in primary and secondary schools to introduce children to basic financial mechanisms in order to create a common knowledge base,” Yves Desjardins urges.

(1) Schroders appointed alan. Agency and iResearch to conduct their independent online survey of 23,950 investors (including 21,131 active and 2,819 retired) in 33 locations around the world between February 18 and April 7, 2022. For the purposes of this study, an “investor” is anyone who plans to invest at least €10,000 (or equivalent) in the next 12 months and has changed their investments in the last ten years. These individuals are considered representative of the investor population of each location where the survey was conducted.

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