Two-year-old children cannot naturally distinguish the difference between what they simply ‘want’ and what they ‘need’. Unfortunately, the same can be said about many adults when it comes to spending and saving. Renee, Project Leader for the NGO Education Delivery Center (EDC), is working to change the culture of personal finance in her country of Mongolia, teaching adults how to save as well as shaping the thinking of children starting as young as two.

On a summer day in late June, Blue Sky Aviation flew a team from EDC and the Mongolian Sheep Association to the rural town of Tosontsengel for a day of community development training. Renee and her colleague planned a seminar on personal finance for adult women and another for teenagers. Flying with Blue Sky Aviation allowed the team from the capital to complete their seminars and return the same day versus a full day of travel each way by road.

The Training

About 35 women and a few men gathered in a large auditorium in Tosontsengel for Renee’s session on financial savings. Using a PowerPoint presentation plus three traditional Mongolian savings boxes in graduated sizes, Renee spoke to the group on how to save, what percentage of their income should be set aside for necessities and future needs.

After the training, Renee reflected on the response she felt from the attendees. Everyone agreed that they wanted to make changes, Renee said, “But when I asked, ‘Are you ready to make those changes now?’ only two people nodded their heads. I can tell they want to make changes, but they don’t know how. I left my phone number and told them if they need me, if they really want to make changes, they can contact us.”

And people do call the organization. “Constantly,” Renee affirms. “Per day I’ll receive about 30 to 35 phone calls, mostly housewives who are not working yet and looking after the kids. They call and ask for the training, and want to talk. We especially work with the wives because the women can be influenced up to 47% more than the men.”

The Problem

The Financial Literacy of a population – the knowledge, skills and determination to act in one’s best financial interests – is important to the overall economic well-being of a country. A World Bank study in 2012 showed that many Mongolians have a limited understanding of the basic financial concepts required to make savings and investment decisions. The Mongolian government understands the need for a national financial literacy program that would include education for school children and rural residents.

Changed Lives

Renee has many stories of lives changed by the financial training, but Tsetsegee stands out, a cleaning lady at a school who made only £81 a month when she first came to EDC for training. She wanted her two grown boys to attend university but didn’t have the money. Because of the training, Tsetsegee now runs her own small recycling collection business, is putting her two boys through university, and has bought the family a ger (the Mongolian version of a yurt).

Challenges and Solutions

However, changing the way people think and long-established habits does not come easily. “Mongolians believe you should have enough income to save,” Renee explains, “but we don’t think that. As long as you’re earning or making some money, just put up to 5%, or even 3% in savings.”

Although participants in a training session love the ideas put forth, they don’t all have the discipline to follow through. For this reason, EDC is committed to starting financial literacy at a young age through education in the schools, raising up a generation that can distinguish wants from needs and be financially responsible. “The government and Central Bank of Mongolia want us to reach the high schoolers with our new curriculum and teacher’s guide,” Renee explained. “We’ve published 14 handouts for adults and kids, and published the nation-wide curriculum for financial literacy.” Children are the key and according to Renee they are the easiest to teach. Using traditional wooden boxes in three sizes, money is divided between savings, spending, and sharing.

“It’s the easiest thing,” Renee says.