Table Of ContentFinancial Literacy and
Money Script
A Caribbean Perspective
Christine Sahadeo
Financial Literacy and Money Script
Christine Sahadeo
Financial Literacy
and Money Script
A Caribbean Perspective
Christine Sahadeo
St. Augustine Campus
University of the West Indies
St. Augustine, Trinidad and Tobago
ISBN 978-3-319-77074-1 ISBN 978-3-319-77075-8 (eBook)
https://doi.org/10.1007/978-3-319-77075-8
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To my parents (deceased) Sookhranie and Dookin Ram
To my husband Ganesh Sahadeo
Acknowledgments
The decision to write this book has many beginnings or roots. Probably
the most important was my mother’s approach to financial independence
(in particular with regard to her seven daughters), education, and manag-
ing one’s life and happiness. My mother was determined that all her chil-
dren had an opportunity of a good education. This was probably due to
the fact that she was denied the opportunity to become a teacher, (owing
to the Hindu tradition that females should not work) and wanted to
ensure her children were successful, attained financial independence and
seized the opportunities that she was denied. At home she taught us
about savings, investing, putting aside for a rainy day, and understanding
the word “bankruptcy” from an early age.
My learning and understanding of the importance of real estate also
came from my mother. She proudly explained her decision to move from
the lovely village of Surry, Lopinot, to Tacarigua, which had schools, reli-
gious establishments, easy access to public transportation, and most
importantly allowed her children an education. I learnt from her that
property is all about location, location, location!
In September 2006 as a Member of Cabinet I was privileged to be part
of the decision to introduce a National Financial Literacy Program, which
was introduced in the 2007 Budget of Trinidad and Tobago with the
stated rationale, and I quote “The average consumer is now required to
make complex financial decisions such as contracting mortgage and
vii
viii Acknowledgments
installment loans, choosing from a range of checking accounts and select-
ing savings instruments.”
On leaving government, I joined the University of the West Indies in
2008 and I must thank the former Head of Management Studies, Errol
Simms and former Principal, Professor Clement Sankat who approved
the introduction of Financial Literacy to the University of the West Indies
(UWI) and the partnership with the Central Bank of Trinidad and
Tobago in 2010. I must thank the then Governor Ewart Williams for the
support of this partnership with the Central Bank. I must thank Denyse
Patrick who assisted in the early stages of this book and Tamara Rampersad,
my research assistant, who provided tremendous assistance in proofread-
ing the contents of this book. I must thank my son Avinash for his
insightful feedback and critique.
The selection of topics to include in this book was a challenge. I have
to confess that homeownership and entrepreneurship were included
because of my own experience and saw them as fundamentally important
in the life of every individual. Becoming an entrepreneur has always reso-
nated with me. So when my young son at 17 wanted to start a business
while still at secondary school, I supported the venture. The business has
grown and albeit he is a chartered accountant and spent five years in the
profession, he is now a full-time contractor and entrepreneur. My younger
son is a born entrepreneur, and after leaving university he joined the fam-
ily business and took it to new heights while starting his own business.
Based on my own children’s success, I wanted to assist others in becoming
entrepreneurs. Accordingly the topics on entrepreneurship and prepara-
tion of business plans were included in this book.
In 1977 I suffered great pain on the loss of our home by fire which was
not insured. My father had recently retired due to a medical condition
and older siblings were encumbered with mortgages and family commit-
ments. I was in a dilemma and had to change career options to one that
would allow me to work and study. Being good with numbers, I gave up
my first choice of medicine and began a career in accountancy. I fre-
quently question if this was my destination or was it just karma? This
however afforded me the opportunity to understand homeownership and
debt financing. I had to secure a loan at the age of 19 and select, employ,
and manage a contractor to build a two-story home. The construction of
Acknowledgmen ts ix
a two-story building although costlier than a single-story converted our
home into an investment, the rental of the ground floor providing income
to repay the mortgage. Homeownership is usually one of the biggest
investments in one’s lifetime and many times decisions are made without
adequate knowledge or understanding of this investment. I saw this as an
opportunity to include homeownership in this book as an important
ingredient in acquiring financial knowledge.
The financial literacy program was very impactful at UWI and in 2012
it was also introduced as a co-curricular course. Although the topics
included under this program are expansive, there are many subject areas
worthy of consideration, such as preparation and understanding wills,
personal income tax, and tax planning. We live in an ever-changing and
turbulent world and it is becoming more imperative that we understand
the basics in financial literacy so that we have the ability to make informed
judgments and take effective decisions in the use and management of
money.
Contents
1 A Review of Financial Literacy Initiatives in Selected
Countries 1
2 Attitudes and Money Scripts, Goal Setting, and Budgeting 21
3 Saving and Investing 35
4 Debt Management 57
5 P lanning for Retirement 67
6 R isk Management 81
7 H ome Ownership 131
8 Introduction to Entrepreneurship 175
xi
xii Contents
9 Basic Financial Accounting 207
10 Business Planning 231
Index 249
