Making students money-savvy

BY SHAHANAAZ HABIB
KUALA LUMPUR: A Bank Negara agency wants final-year undergraduates to take a course in financial management because many of them are not very savvy in handling their personal finances when they join the workforce.

Credit Counselling and Debt Management Agency (AKPK) chief executive officer Mohamed Akwal Sultan said the agency was looking at whether this can be offered as an elective course at local universities for those in their final year. “These students will be leaving university soon. That’s when they get their first credit card, when they start shopping for a car and a house and get into debt.

“We realise they are not very savvy about financial management. Very often they start making not-so-wise decisions when acquiring these things,” he said. Mohamed Akwal believed that if people were well educated on financial management there would be fewer debt problems.
That is why he sees the need for graduating students to be educated on things to look out for when buying a car or a house and to ask themselves if they have the money to buy them.
“If you come out (from university) with your eyes open, chances of you getting into debt issues are less,” he added.

AKPK is a subsidiary of Bank Negara, set up recently to counsel and educate people on managing their money and debts. Mohamed Akwal said there were cases where parents came to them for help because their working children could not repay their car loans and settle their credit card payments.

“Their children want their fancy cars and their daily cup of gourmet coffee, but when they start paying their rent and car instalments they find that their income is not sufficient to pay for their lifestyle. Then the parents have to bail them out,” he said. Mohamed Akwal said AKPK had discussed the idea of the university course but that it was still at the conceptual stage.
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We plan to convince the Higher Education Ministry that we think it is important to make this an elective course,” he added. Mohamed Akwal said AKPK would not have the resources to provide lecturers, but that it could propose the course syllabus and let the universities provide the lecturers. There were also plans to teach financial management in schools, he added.

“What you are taught when you are young, you carry into your adulthood. If youngsters are taught early to put money in their piggy banks, they would have the concept that savings is important,” he said. He said the agency planned to enhance Bank Negara's Buku Wang Saku programme in schools, where Bank Negara gave out booklets and got students to track their spending. Mohamed Akwal added that he had already discussed with consultants on what students should be looking at.

He said the knowledge could be imparted as part of extra-curricular activities, by having teachers run through it before the term break through the Web or by giving out CDs on financial management. “If we don’t educate, we are not nipping the problem in the bud. And the process of credit-counselling and debt-managing people will be never-ending,” he added.