Old Mutual calls for stronger financial education

Working Ghanaians have been urged to improve their financial planning and long-term savings habits as concerns remain over financial vulnerability and low retirement preparation.

The call was made at the Old Mutual Financial Well-being Monitor event held in Accra last Wednesday to provide insight into the financial attitudes, behaviours and challenges of workers in the country.

The programme also sought to promote better savings, investment and financial well-being among Ghanaians.

The Group Chief Executive Officer of Old Mutual, Roy Punungwe, said findings showed that more work needed to be done in financial education and consumer guidance.

He said many people were still making financial decisions without enough information, making it necessary for financial institutions to invest more resources into public education.

“We needed to invest time and resources into educating consumers about the financial options available to them so they could make informed decisions,” he said.

Mr Punungwe said access to financial advisors also remained a challenge, adding that there was a need to train advisors properly to avoid misinformation and build trust within the financial sector.

He said the economy was beginning to show signs of recovery, citing single-digit inflation, currency stability and renewed activity in the bond market as positive indicators.

“We had left Egypt, but we were not yet in Ghana, so we were still on the journey and needed to sustain the progress being made,” he said.

Mr Punungwe said Old Mutual remained confident about the investment environment and assured customers that their investments with the company were protected.

“If you had a financial solution with Old Mutual, we would protect it and grow it responsibly,” he said.

He added that the company would introduce additional financial products later this year to encourage more long-term investments among consumers.

Financial vulnerability

The Head of Knowledge and Insights at Old Mutual, Vuyokazi Mabude, said the report showed signs of recovery in the financial outlook of many Ghanaians.

She said people were cutting down expenses, saving more and gradually recovering from previous economic difficulties.

Ms Mabude said many households remained vulnerable to unexpected expenses such as medical emergencies and loss of income.

“Most consumers could only survive between one and three months without an income, which showed that financial vulnerability was still high,” she said.

She said 67 per cent of respondents reported lower debt levels compared to the previous year, while 37 per cent said they were earning more than before.

Retirement concerns

Ms Mabude said retirement planning remained a major concern because only about a third of respondents were actively saving towards retirement.

She said many people were also not using formal retirement or banking solutions to prepare for the future.

“It was important for people to start planning early because failure to save for retirement would increase pressure on future generations,” she said.

Ms Mabude further advised people with side businesses to avoid investing household income or money meant for children’s education into risky ventures.

She said insurance and financial protection should also become a priority for households to reduce the impact of financial shocks.