Filling the need for financial literacy

Filling the need for financial literacy

In this edition of Active Voice, Cathy Saunders talks with Putnam practice management specialists about the work the firm is doing to support advisors and provide financial literacy education.

Q&A with Cathy Saunders

  • Tiffany Dyson, Senior Practice Management Specialist, Putnam Investments
  • Alex Nawoichik, Lead Practice Management Specialist, Putnam Investments

CS: Financial advisors play a vital role linking savers building financial assets with the financial services industry. A critical part of your work in practice management is fostering financial literacy and supporting a culture of saving and investment. Tell us about this work.

AN: I’ve spent my career at Putnam in practice management sharing best practices with financial advisors, learning from them, and building networks to share knowledge. Our goal is to help advisors help their clients. I’ve been able to focus on specific areas of need, including women and younger investors. These are groups that have often felt underserved by the financial services industry.

TD: I’ve had a similar career experience at Putnam, and my work focuses on diversity and inclusion and financial literacy. These themes resonate with me because I come from a family that my parents supported through their work at a grocery store in California. I dreamed of going to college, but the financial challenges seemed overwhelming. Fortunately, I received a significant financial aid package and was able to pursue my education.

Initially, I had no interest in financial services, and I did not understand the industry. But I had a friend who worked at Putnam, and after meeting some great people during the recruitment process, I applied for a job. I realized I had found a financial firm dedicated to the mission of helping people build savings and care for their families. At one point, I considered a career path in social work. But because of the unique culture here, I believed I could achieve my career goals of helping people, and I stayed.

CS: Alex, in your practice management function, what are some of the insights and educational tools that you offer to advisors?

AN: Consistent with our mission around millennial investors, diversity, and women and wealth, we share our perspectives directly with financial advisors. We are avid users of social media and digital conferencing technologies. Traditionally, a lot of this type of information has come from advisors’ home offices. Among some in the industry, there is the perception that younger workers do not have any appreciable assets and so this group should not be prioritized. But younger investors are positioned to build their wealth. Many are already actively investing with online trading apps. These young investors may also benefit from a substantial intergenerational transfer of inherited financial assets, which is projected to be in the trillions of dollars over the next 30 years.

CS: As asset managers we have a responsibility to our shareholders and stakeholders. Building assets helps people buy a home, save for retirement, educate children, and realize their philanthropic goals. At the same time, we can help financial advisors grow their practices.

AN: That’s right. I had an “aha” moment when I was supporting the Putnam team in North Carolina. I had been on the phone and in videoconferences for years helping advisors realize their professional goals. One day, I found myself driving down a particular street in Charlotte and realized I had scheduled literally hundreds of meetings along that very road over the years. It suddenly became tangible for me — we had helped these people, in this community, in this city.

Another interesting moment for me was our participation in The Equity Collective — a diversity-driven collaboration between Morgan Stanley and 27 wealth and asset management firms. This was an example of the industry putting a stake in the ground for diversity and inclusion, financial literacy, and for bringing diverse people into the industry.

We’ve also had the opportunity to bring the financial literacy materials that Tiffany has created to a variety of stakeholders, such as middle schools and high schools that have no financial education curriculum, and to community groups, such as the Charlestown Boys and Girls Club of Boston near Putnam’s headquarters.

CS: Tiffany, tell us about the thought leadership and educational materials you create.

TD: We operate under the assumption that our target investors, like everyone else, are experiencing information overload. Younger millennials and Gen Zers are getting financial “advice” from YouTubers and TikTokers. These influencers have no federal licenses or professional certifications. They may not have studied finance or economics for more than a couple months. Putnam saw an education gap that we could help fill. The financial advisors we work with have the education, licenses, knowledge, and experience.

These advisors serve their clients and their clients’ children — many who are going to college or starting a career without learning the basics of banking, lending, or investing. We work with our advisor clients and with the local community groups and nonprofits they work with. We try to help advisors work with young investors and make education accessible outside of social media. Advisors are concerned a vast quantity of wealth can be lost between generations just through lack of financial education and mismanagement. It’s critical that we reach out to young people to secure an orderly transfer of wealth across the generations.

CS: Thanks, Tiffany and Alex. It’s so great to hear about the work we are doing at Putnam to support advisors and provide education within our communities. It is so important to help the next generation of investors become financially literate, enabling them to make more informed decisions as they begin to save and work toward their financial goals.

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