Investment Basics and Investment Resources: What Library Staff (and Financial Educators) Need to Know

Barbara O’Neill, Ph.D, CFP®, AFC, CHC Rutgers Cooperative Extension

oneill@aesop.rutgers.edu

• Libraries are receiving funding to provide financial education to patrons and/or staff

• Prohibited or discouraged from using financial services professionals as speakers

• GREAT opportunity for Cooperative Extension, academics, non-profits in financial field

What’s Happening?

Personal Experience • Three library financial education grant projects, 2011-14

• Burlington County (NJ) Library System: 8 consumer classes (@2.5 hours), two 6-hour library staff trainings, and 16 webinars (when class attendance was low)

• New York Public Library: 42 well-attended programs for NYPL library staff (@3 hours): https://sites.google.com/a/nypl.org/money-matters/

• Piscataway Public Library: 6-hour staff training, 16 consumer classes, and 8 webinars: http://piscatawaylibrary.org/finliteracy

Why Libraries for Financial Education?

• Aura of trust

• Environment is not overwhelming

• Internet access

• Free/low cost services

• Personal assistance/help

• Variety of objective resources 4

Recommended Archived Webinar: http://cfs.wisc.edu/home.aspx

Center for Financial Services (CFS), Univ. of Wisconsin "Public Libraries as Financial Literacy Providers" December 13th, 2011. CFS Affiliate, Kristin Eschenfelder presented her research which examined the activities public libraries use to increase the financial literacy of their service populations.

Big Concern of Librarians: Information vs. Advice

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• Giving advice is telling another person what they should do. It may send an unspoken message that the listener is not capable of making his/her own decisions, but needs to be told what to do. Giving information lets the person know what the options are so he/she can make the decision about the best course of action.

Library’s Role • Be a resource center of information

• Assist patrons in formulating their questions/needs

• Assist patrons in finding answers to their questions

• Guide patrons to appropriate resources

• Encourage research

• Encourage personal action

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Financial Education Helps Libraries

• Build patron and staff knowledge and skills

• Provide new or extended resources

• Form community partnerships

• Provide information for today’s needs

• Serve as a valued “information intermediary”

Source: National Endowment for Financial Education

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Benefits for Library Staff – Increased knowledge for self

–More confident

– Improved financial behaviors

–Greater understanding of resources

– Increased knowledge for patrons

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Benefits for Program Cooperators

• Access to new audiences

• “Low-maintenance” programs

– No marketing and arrangement responsibilities

– Just show up and teach

• Grant subcontractor funding

• Form community partnerships

• Provide information for today’s needs

BCLS Grant

FINRA Investor Education Foundation Content Modules

• Free of charge and downloadable

• 11 content modules; together = “a book”

• Source of consumer program and library staff training

• Designed for beginning investors • http://www.finrafoundation.org/resources/education/modules/

NYPL Grant Program Title: Money Matters

Piscataway Public Library Grant

• 6-hour staff training, 16 consumer classes, and 8 webinars: http://piscatawaylibrary.org/finliteracy

• Many classes pre-arranged with off-site partners (Senior Center and worksites) and two other libraries

• Five consumer class topics, two senior class topics

• 500 tweets with “Smart Investing @pisclib” introduction

• 6-hour staff training had 2 parts:

– Morning: Investment Basics

– Afternoon: Investment Resources

• Leveraged (tweaked) slides, resource lists, and animated videos from previous NYPL and BCLS grant projects

Investment Basics • 48 slides

• National Financial Capability Quiz (5 questions)

– Pre-test at start of session

– Review answers at end of session

• Investment Risk Tolerance Quiz (Grable & Lytton): http://njaes.rutgers.edu:8080/money/riskquiz/

• The “Wealth Test” (from The Millionaire Next Door)

Investment Basics Topics • Saving vs. Investing (Venn Diagram Activity) • Ownership and Loanership Investing • Risk-Reward Trade-off • Types of Investment Risks • Techniques to Mitigate Investment Risks • Investment Risk Tolerance • Taxable vs. Tax-Deferred Investing • Bond Basics • Stock Basics • Mutual Fund Basics • Employer Retirement Savings Plans

Investment Resources • 48 slides

• Two animated videos from NYPL project

• Small group discussion with case studies: “When a Patron Asks”

• Investment Coat of Arms

• Ballpark Estimate worksheet (retirement savings)

Investment Resources Topics • Rutgers Cooperative Extension web sites

• eXtension web sites

• State and federal agency web sites

• Non-profit and trade association web sites

• Investing videos

• Investment fraud information

Key Take-Away Advice • Dovetail library grant projects: work smarter, not

harder

• Work with libraries to select program topics

• Work with libraries on program marketing methods

• Respect FINRA oversight and editing role

• Collaborate with third-party evaluator

• Recognize that project deliverables could change

– Example: Cancelled classes replaced by webinars

Comments? Questions? Experiences?

Financial Literacy @ Your Library: Get involved!