“When it encounters physical danger the body acts on its own accord by producing reflex actions to save itself. But there is no such in-built mechanism to tackle financial danger and thus it becomes important to be educated in financial literacy,” said Sucheta Dalal, Founder-Trustee of Moneylife Foundation. She was speaking to a batch of 40 youngsters at a summer special “When it encounters physical danger the body acts on its own accord by producing reflex actions to save itself. But there is no such in-built mechanism to tackle financial danger and thus it becomes important to be educated in financial literacy,” said Sucheta Dalal, Founder-Trustee of Moneylife Foundation. She was speaking to a batch of 40 youngsters at a summer special seminar. She explained to the students why it was essential to look at money differently and understand risks.
Explaining the difference between consumer products and financial instruments, she said since there are demonstrations or test-drives for the former but not the latter, it becomes important to be cautious before purchasing a financial product.
“Most of the important and relevant information about what could pose a threat in the future is lost in the fine print of scheme documents or consumers are manipulated to buy low yielding products as they are constantly bombarded by heavy ad campaigns featuring celebrities,” Ms Dalal said.
According to research, high achieving professionals are the most likely to be defrauded, she said.
Citing examples of how about 23-24 people trapped in the Sharda Scam committed suicide when they did not receive even 15% of the money invested, she described how mentally and financially ill a person can become after being cheated. Scamsters are four steps ahead of the authorities.
Talking about phishing and vishing practices prevailing, she said it was important to remain debt free on your credit card usage. “Everything you do is being tracked”, she said. She pointed out that four credit rating agencies maintaining your credit score will be notified in case of a default. Social media posts are being tracked and HR agencies read one’s blog post and assess one’s behaviour.
Showing a video of the Marshmallow Experiment by Walter Mischel, she says, “Life is about being able to say no to temptations. If you learn to say no, only then you get higher returns.”
The students were also shown the 17 features of the new Rs2,000 note and taken through a tour of the earlier currency in India and some fun facts about it.
In case of any confusion regarding financial instruments, she asked participants to contact the National Consumer Helpline or lodge a query with the Government’s PG Portal, http://pgportal.gov.in.
