How consumers can ‘take the heavy lifting’ out of investing

Yahoo Finance’s Zack Guzman and Akiko Fujita discuss how Americans can improve their financial literacy during COVID-19 with Elisabeth Kozack, Marcus by Goldman Sachs Co-Head of Consumer Lending.

Video Transcript

AKIKO FUJITA: A new survey out from Marcus by Goldman Sachs reveals just where Americans are turning to, to improve their financial literacy. And it turns out social media is a big resource. Nearly 50% said they learn about financial matters through financial websites. Good news for those like Yahoo Finance. But take a look at these numbers in terms of where Americans are turning to for some financial advice.

Let's bring in Elisabeth Kozack, Marcus by Goldman Sachs co-head of consumer lending. Elisabeth, it's good to talk to you. I guess, if there's anything we learned from the Reddit trade, it is that we do know there's discussions about the markets and financial matters that are happening on sites like Reddit. What surprised you about the study here in terms of which one of these platforms are turning out to be a big help for a lot of Americans who are looking for some advice?

ELISABETH KOZACK: Absolutely, well, we know it's important to make informed financial decisions, especially when it comes to saving and investing. And I think the pandemic has really-- it's been a wake up call for many of us to reevaluate or evaluate for the first time our financial plans, thinking about comprehensively your goals, the future that you want. I was really surprised when we did our survey of Americans and how they sought to improve their financial literacy, where they were going and how they were seeking out information.

And I think the fact that so many are going to social media, whether that's YouTube, Reddit, TikTok, was a real surprise to us. And it tells us that we need to be providing the right sorts of information where our constituents and our consumers are and where they're at.

ZACK GUZMAN: Yeah, I mean, as we've seen with some TikToks out there, maybe not the best of places to go. Of course, it's just a platform. You can get some good content. You can get some bad content. So when you look in, though, at where people would have wished they could have learned about these things, right, we talk about personal finance being taught in schools or maybe not as much as it should, what did you see when people turn to that alternative, and what they would seek to change maybe for generations to come?

ELISABETH KOZACK: Sure, well, one thing that's surprising to me is that only 13% of those people that we surveyed were actually taught about personal finances in school. So it shows there's a real opportunity to improve that from the starting point. More people are actually learning about personal finance from their parents or even teaching themselves, actually. We found about 38% of Americans were learning about personal finance from their parents, for example.

So I feel like given how challenging many people-- our research has very much showed that it is-- that investing and personal finance can be intimidating. We need to be able to take the heavy lifting out of that. So whether that's with tips and resources like we have at Marcus.com, or even new tools like our Marcus Invest feature, which really is designed to take the heavy lifting out of investing. We enable consumers to be able to take control of their finances through products like that.

AKIKO FUJITA: What did you find specifically what people were seeking out on some of these platforms? If we're talking a YouTube or a TikTok, what kind of financial advice are they seeking?

ELISABETH KOZACK: Sure, well, we felt like in COVID-19, then there was a heightened awareness around personal finance, right, and financial matters. The importance of the emergency fund, for example, certainly came up loud and clear. What we found was 58% of those seeking more information about their finances were actually looking to learn more about savings. 49% were looking to learn more about investing. And I think this actually reflects some of our experience, too. We actually saw a 61% increase in deposits balances, whether to our high yield online savings accounts or CDs over the course of 2020.

ZACK GUZMAN: All right, Marcus by Goldman Sachs co-head of consumer lending. Elisabeth Kozack, appreciate you coming on here to chat with us.