Rutherford B. Hayes, our 19th president, wrote: “In the civilized countries of the world, the question is how to distribute most generally and equally the property of the world.”
Hayes was concerned about the distribution of wealth and felt that education was the surest way to give people an equal chance to acquire property. He said, “As knowledge spreads, wealth spreads.”
Hayes’ advice is as applicable today as it was when he was president in the late 1800s. More than half of all Americans are now invested in the securities markets, yet a great many of those investors don’t really know what they are doing. Many are inappropriately investing their money. And the lack of knowledge makes others vulnerable to fraud.
That’s why investor education and protection initiatives are so vitally important.
To that end, the Investor Protection Trust, a nonprofit investor education organization, has launched “MoneyTrack,” a new 13-part series airing on Public Broadcasting Service stations. The show will air on Seattle’s KCTS Channel 9 as a summer replacement for the station’s locally produced “Serious Money” program starting July 1 at 8 p.m.
The half-hour show covers such aspects as managing debt, teaching teenagers about investing and helping couples merge their lives and their money.
The financial makeover episode I previewed was well-produced and quite interesting. In the episode, we meet the Halls, a San Francisco couple struggling between saving for retirement, building a college fund for their children and paying down major debt.
The couple get a chance to sit down with a financial planner, who develops a five-point action plan for them to get out of debt and free up money to invest for their retirement.
“To paraphrase Kermit the Frog of the PBS show ‘Sesame Street,’ it isn’t easy managing green,” said Don Blandin, president and CEO of the Investor Protection Trust. “‘MoneyTrack’ is designed to show consumers that they do not have to know everything about business or Wall Street to retire financially fit and live well.”
Every episode has two standard features: Investing 101 and Scam Alert. The investing segments feature experts explaining the basics, such as mutual fund investing. Scam Alert cautions viewers on how to avoid the most common frauds.
In addition to the public TV series, the trust is partnering with the American Library Association and Kiplinger to launch a comprehensive investor education program in public libraries across the country. “Investor Education @ Your Library” will include materials such as “MoneyTrack” DVDs, brochures and seminars.
This major initiative with the American Library Association will provide just what the public needs – free noncommercial investor education.
It’s the free, and the noncommercial nature of the program is crucial. There already is a lot of free investor information out there. However, much of it is being peddled by people and companies trying to sell financial products or services. Thus the advice comes with an agenda, a bias.
Since 1993, Investor Protection Trust has worked with the states to provide independent, objective investor education. Its mission is to educate the public about investing using money collected in settlements against investment companies that have been accused of wrongdoing.
In 2003, the trust got a major infusion of cash after seven Wall Street firms agreed to pay a total of $80 million for investor education. Of that amount, $27.5 million was earmarked for state securities regulators. Those funds comprise the Investor Education Fund, which is overseen by the trust.
When Blandin was named president of Investor Protection Trust last year, he said, “We will be smarter about how we provide investor information. We will collaborate and coordinate our efforts with other organizations that share our mission of raising the level of financial literacy and investor protection.”
Blandin has kept his promise. The trust is raising the bar of investment education.
Some would argue that the millions the firms paid should have been divided up and given directly to investors. But as these types of large settlements go, when there are potentially hundreds of thousands of victims, individual investors would have just gotten chump change.
“While there is nothing I would like more than seeing money returned to investors in circumstances of fraud, the fact is, in this case it would be a (tiny) amount per investor,” Blandin said.
“The fines imposed on the financial services companies did not come close to covering the losses of investors. Our goal now is to equip all investors with the intellectual armor they need to avoid scams and invest wisely for their financial future.”
Remember what Hayes said: “As knowledge spreads, wealth spreads.”
Washington Post Writers Group
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