Boosting financial wellness through education

When we think about the concept of wellness, we may immediately associate it with our physical and emotional wellbeing. Those working on wellness might opt for some exercise or meditation and make an effort to stay close to loved ones and make personal time.

But often, our wellness can be impacted by the administrative and financial stress, too. For example, we may overlook the fact that managing  debt and mortgage payments can play an integral part in achieving peace of mind, particularly during periods of economic uncertainty such as that posed by the COVID-19 crisis.

Before we can achieve financial security, however, we need to be equipped with sufficient knowledge around our finances to enable us to make informed decisions.

This is where many clients and borrowers may feel that they fall short. In fact, recent research by digital bank UBank revealed that 80 per cent of aspiring home owners feel undereducated when it comes to saving for or purchasing a home, and this number increases to 86 per cent for millennials.

This is despite 44 per cent of all millennials listing buying a property as one of their top two savings goals over the next five to seven years.

The Know Your Numbers survey of 1,065 Australians aged 18 and over, also found that 31 per cent of respondents do not know where to begin, while 21 per cent do not know how much they would need to save. Meanwhile 35 per cent of homeowners admitted that they were unaware of the fees associated with their home loans.

While clients may be eager to enhance their financial knowledge, the terminology, jargon, and abbreviations can make finance seem like a foreign language and discourage them from attempting to understand it.

Reaching a larger audience

This is the gap that Mikaela Patterson, finance broker at Entourage Finance, is aiming to fill.

Having been in the broking industry for almost 15 years (joining Entourage Finance in 2017), Ms Patterson had observed that she was commonly answering the same questions to clients – noting a void in financial literacy in Australia.

She explained: “Over the years we’d seen so many members come to us and often I’d get the same question: What does having a credit card limit in place mean for my loan application, or how does that affect my credit file?” she told The Adviser’s Elite Broker podcast.

Her colleagues were also hearing that their clients were concerned about their lack of understanding of different financial terms, and how they were interconnected.

She added: “In the past I’ve gone through my own struggles financially, [from] just not understanding things.

“I guess [it comes from] never receiving a proper education [on finances], and I’ve also seen family members go through some pretty tough financial times,” she said.

The combination of these factors, along with Ms Patterson’s passion for improving financial literacy, her to develop and implement a financial wellness program that she now runs for a range of corporate businesses across Australia.

She saw an opportunity to reach a larger group of people by targeting businesses with 50 or so employees. Attendees included business employees “on the ground”, as well as C-Suite level employees.

Ms Patterson specifically targeted what she calls “the average Australian”.

“I think it is important to get everybody educated on financial wellness so it doesn’t matter whether they're a CEO or even just the cleaner… I think everyone at any level can gain something from the workshop,” she said.

She began by presenting a workshop to one business, which was food delivery service Deliveroo. But she quickly multiplied her client base through word of mouth and promotion on social media, and has conducted a dozen workshops to date.

“I think it just allows us to educate a lot more people at one time rather than just that one conversation that we’re having with our clients,” she said.

Her workshops and dedication to financial literacy landed her the title of Wellness Advocate of the Year at The Adviser’s Australian Broking Awards 2020, held in July.

Taking away the taboo around money

In the workshops, Ms Patterson uses simple language to educate attendees about financial wellness, what it means, and underscore the fact that it can mean different things to different people.

She points out, for example, that someone earning a six-figure salary could be under more financial strain than someone earning a salary that is below the Australian average rate of earnings.

She also provides tips on budgeting, how borrowers can pay off their mortgage faster, how credit files can be affected by repayment histories, and steps they can take to improve their financial wellness based on their current financial, mortgage, or debt situation.

“The message throughout the whole workshop is just trying to get people to seek help from a professional,” she said.

“There’s so much free advice available and that’s really the key: is just to sort of take away that taboo of speaking about money and trying to make people not be scared or intimidated by speaking to someone.”

Ms Patterson concluded by highlighting the important role mortgage brokers can play in boosting financial wellness in Australia as they are privy to people’s financial situation on a daily basis.

“We've got a wealth of knowledge of different financial terms,” she said.

“If we can’t help them with one thing we know exactly where they can go to get help in another area, whether it be insurance or superannuation.”

Calming the nerves – tips for public speaking

For many brokers who wish to conduct workshops and seminars in their areas of expertise, a fear of speaking in front of a live audience might be hindering them from taking that step. Ms Patterson was no different.

“That is one of my biggest fears. I still find it hard now. Even after doing over a dozen of them, you’ll get extremely nervous before [going in],” she confessed.

However, she decided to speak to a confidence coach to combat her fears and nerves, which she found very useful. She provided some tips to quash any fears of public speaking.

“You just need to remember that what you’re presenting is information that people want to hear. It’s valuable,” she said.

“The other thing is people that are sitting there watching you don’t want you to fail.”

Finally, she has found that mingling with the crowd and striking up casual conversations before each session calms her nerves.

“It straightaway calms me down and gets me on a level playing field with the attendees,” she concluded.

Tune in to The Adviser’s Elite Broker podcast with Mikaela Patterson to find out more about how she did it: 

The month of November marks The Adviser’s Women in Finance month, as we profile some of the leading women in this industry.

As well as the Women in Finance themed magazine, we’ll also be having female-centric podcasts and running profiles and content in the daily bulletin, too.

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[Related: Why this award-winning broker is focused on financial wellness]