Low percentage of Maltese with knowledge of personal finance ‘worrying’

Most Maltese persons have an “acceptable” understanding of basic financial concepts, ut the majority were not applying this knowledge when making savings and long-term investment decisions.

A survey covering 1,255 respondents, based on a pilot study undertaken by the Organisation for Economic Corporation and Development (OECD) in 2012, and sponsored by MSV Life, revealed that only 21.9% of those surveyed held specific plans for their retirement and that only 21% of those aged 53 or under had an idea of  what their applicable state pension would be.

Other revealing conclusions were that no less than 45%  of respondents showed an attitude of living for today and not caring to save for the future.

Also, as many as 40% of respondents are not in the habit of having a household budget which is essential for generating savings and planning for the future. These statistics are a cause for concern in that they reveal attitudes and behaviour which fail to provide for circumstances in life when a person needs to access funds in an emergency or to enjoy a decent retirement, which may last a good 20/30 years.

Commenting on these findings, David G. Curmi, CEO of MSV Life, emphasised the role of his company to continue  to ecourage people to understand the importance of managing their finances responsibly and of taking balanced decisions which will ensure that they can continue to enjoy their desired lifestyle over the long term.

MSV Life have its full support to research work undertaken by student Ann-Marie Mangion, reading for Bachelor of Commerce, Banking and Finance of the University of Malta in connection with a dissertation on the subject of “An Analysis  of Financial Literacy in Malta”, helping in the compilation of the required data, the development of the surveys and the encouragment of responses to the surveys.

“Our company is committed to contribute towards developing a stronger savings culture in Malta. The trend of diminishing savings in Malta is not unique to the island but is, indeed, a European-wide phenomenon,” Curmi said.

Also, Stuart Fairbairn, Chief Officer Business Development, explained that the company “continuously strives to make tools available to the public at large with the intention of making financial education easily accessible to all”. As examples, he referred to the MSV Simple Guides, the free online calculator on MSV website which is easy to use and may be very helpful in making financial decisions as well as the information available in the company’s Facebook page.