I believe there are a handful of big topics that are worth really digging into in the asset management world right now: the future of fixed income, the evolution of ESG, tokenization, the ethics and impact of indexing, and the shifts in our understanding around portfolio theory. Those are the big heady topics I’ll be wrestling with for a long while.Underneath the hood, however, there are 20–30 key influencing issues that are worth understanding, because they’ll underpin the future of finance, and last time I looked, my business card said Financial Futurist.Top of mind for me has been financial education.
…Dr. Preston Cherry, who heads the Financial Planning Program at University of Wisconsin-Green Bay and who is also the founder and president of his own financial advisory practice, thinks that the most important piece is something he deems “financial compassion.”
Financial compassion is about asking questions, real questions, emotional questions, without judgment or preconception, says Cherry: “How do you feel about your money situation? Your money thoughts? Share with me about your life and your money, your knowledge, your culture, your experiences. Let’s get better informed about where you are and how you feel about it.” This applies even if the person on the other side of the table is a 13-year-old and not a prospective financial planning client. The important questions, the emotional ones, are the same at 13 as they are at 73.
But that’s rarely how financial education is structured. All the great curricula on financial education is facts and figures — exercises designed to instill knowledge in bog-standard, American academic pedagogy. Present some facts, complete an exercise, take a test. From my own narrow experiences of raising kids, helping out in schools, and observing in classrooms, there’s little room for real compassion and connection in the modern classroom, despite the best efforts of great teachers. There’s rarely time to have the one-on-one conversations and establish the emotional connections necessary to learn about money effectively.
To improve financial literacy in this country, we don’t need more textbooks. It’ll take cash and labor. Maybe an Americorps for Financial Education. But until then, it’s mostly going to take creativity.