By Tatyana Hopkins
After just nearly four years of payments, Charlinda Sims, M.Accy. ’15, made the final payment on her $80,000 student loan balance, in July. Now she teaches others how to build financial success on her Instagram page, and she gives credit for her own financial fitness to her former personal finance professor at the George Washington University, Annamaria Lusardi.
“Your methodology of showing me the cold, hard numbers made it a no-brainer to pay it off sooner than later,” Ms. Sims wrote in a letter to Dr. Lusardi. “Your class has changed my life.”
Leo Moersen, associate dean for undergraduate programs at the GW School of Business, shared the contents of the letter at a ceremony Thursday honoring Dr. Lusardi with the 2018 Ketchum Prize. It was awarded for her distinguished research and teaching in the field of financial literacy.
The Financial Industry Regulatory Authority (FINRA) Investor Education Foundation awards the annual $10,000 prize, named after its former chair and CEO Rick Ketchum, to researchers and educators whose work and service make substantial advancements in financial education and protection for underserved American households.
“[Dr. Lusardi] is not only a research superstar, but she is also a teaching superstar,” Mr. Moersen said. “The students appreciate her very much.”
Dr. Lusardi is the founder and academic director of the Global Financial Literacy Excellence Center (GFLEC) at GW, and she is the Denit Trust Chair of Economics and Accountancy at GWSB. Dr. Lusardi said it was an honor to receive the award named for Mr. Ketchum, whom she called a “visionary leader” and “tireless advocate for financial literacy, financial capability and investor protection.”
Last year, she was appointed director of Italy’s newly established Financial Education Committee. She also served as a member of the review committee that developed the U.S. National Standards for Financial Literacy.
Dr. Lusardi chaired the group of financial literacy experts who designed the Programme for International Student Assessment (PISA), which evaluates financial literacy among high school students across countries.
She also has consulted as a research scientist for the FINRA Foundation’s National Financial Capability Study (NFCS), which provides a comprehensive analysis of financial knowledge, access and habits in American households since its inception in 2009.
The FINRA Foundation seeks to assist military service members, Americans of underserved backgrounds, such as low-income families and other everyday investors build financial stability through investment and financial fraud defense. It sponsors innovative research and educational projects aimed at financial fraud and empowering American households with the knowledge and tools to make sound financial decisions and protect their investments.
FINRA Foundation President Gerri Walsh said some of Dr. Lusardi’s most compelling work is advising governments in the United States and globally about increasing financial capability for groups at risk of falling outside of the mainstream of financial services.
“She is recognized as one of the strongest and most high-profile contributors to the field of financial capability,” Ms. Walsh said, quoting from the letters nominating Dr. Lusardi for the Ketchum Prize. “She is a champion of financial education for young people and of financial wellness in the workplace.”
James Wade, vice dean of faculty and research for GWSB, called Dr. Lusardi “one of the world’s leading authorities on financial literacy.”
“She was recently placed in the top 1 percent of business and economic researchers based on her citations,” Dr. Wade said. “As of this morning, she had over 24,000 citations to her contributions and well over 15,000 of these are within the last five years.”
Upon accepting the award, Dr. Lusardi spoke about the importance of global financial capability, research, education and action.
“Through this data, we have learned that we have much more to do,” Dr. Lusardi said of the results of recent NFCS datasets. “The NFCS tells us that far too many Americans have trouble making ends meet.”
She said her findings have showed that most Americans lack the basic knowledge that is necessary to make financial decisions from simple day-to-day transactions to complex long-term decisions. She said the issue was more prevalent among women, young people, minority communities and people with low educational attainment.
“Knowledge matters,” Dr. Lusardi said. “People with higher financial literacy are more likely to have precautionary savings, more likely to plan for retirement and enter retirement with more wealth and are less likely to carry debt as they near and enter retirement.”