Interest in investing is increasing in Belgium. But investing remains an unknown world for many. It is therefore necessary to gain knowledge about this. BEAMA, a sub-association of Febelfin, understands that. As the mouthpiece of the asset management industry, it made financial education one of its main focuses. EFAMA recently created a brochure that explains in 5 steps how to take your first steps on the fair, supported and promoted by BEAMA. To find out more about the investment world, we interviewed Marc Van de Gucht, Director General of BEAMA for the past year.
You are Director General of BEAMA, a sub-association of Febelfin. Can you explain to us what BEAMA does?
Our activity consists of representing the Asset Management sector and developing the Asset Management activity in Belgium, as well as promoting its image and that of its members. Asset Management includes the promotion, portfolio management, distribution and administration of investment funds. In addition to collective products, the term also refers to management mandates for institutional and private clients and investment advice. We are therefore the mouthpiece of the Asset Management sector with policy makers, regulators, civil society organisations, media, etc.
What are your findings after working for BEAMA for one year?
The balance I draw up after 1 year in my position is extremely positive. It has been an intense but very exciting period. Due to the short overlap with my predecessor, I quickly rolled into the position and was able to set my own accents. My in-depth knowledge of the sector gave me a great advantage. It is an exciting position, partly because of the contacts with the various stakeholders who are involved with the asset management sector from close by or from afar. For this I can call on professional employees who know the tricks of the trade, and members of the working groups with representatives from various financial institutions, each of whom makes an interesting contribution to the sector from their institution and with their own specificity. I can also count on excellent cooperation with the Board of Directors and excellent integration within the Febelfin umbrella.
More and more young people are investing.
How can you explain this trend? The increasing interest of young investors in the stock market is due to a combination of factors. On the one hand, there is the insight that money in a savings account no longer yields anything (and even loses purchasing power due to inflation) and, on the other hand, the rising stock prices of recent years have also contributed to the growing popularity.
EFAMA produced a brochure for young people "Investing to build your future" that puts BEAMA in the spotlight. Why are you promoting this brochure?
We notice that young professionals who have already set aside some savings often find it difficult to find their way to the stock market due to a lack of knowledge: they want to invest, but they are still looking for information before launching themselves (e.g. they do not know how much & when they should invest, what they should invest in, how much risk they take and how to get started). We want to give them this information with this brochure. In addition to this brochure, there is also the Club Beleg website, which was created by Febelfin in collaboration with Assuralia and where everyone can inform themselves about savings and investment products and their risks.
Can you tell us a bit more about the EFAMA Investor Education Platform?
Investor information initiatives are essential to improving financial literacy and empowering people to make sound decisions in managing their savings. Without a basic understanding of financial concepts such as risk diversification, compound interest and real returns, you will struggle to invest or make informed decisions. A lack of sufficient financial literacy explains why the vast majority of households do not invest their savings directly in the capital markets. And that is the case all over Europe. EFAMA, the grouping of all European national professional associations of the asset management sector of which BEAMA is a part, has been at the forefront of urging authorities to increase public financial literacy through widespread financial education initiatives. Incidentally, the initiatives of all European professional associations are bundled in a book that EFAMA publishes annually. This can be a good source of inspiration for everyone.
What advice would you give to young people taking their first steps in the stock market?
I assume that young people only take their first step into the stock market with the savings that they can really do without for several years. After all, investing is not something for the short term, but for the medium or long term. The earlier you start it the better. The power of compound interest was not called the 8th wonder of the world by Albert Einstein for nothing. Do not invest everything in the stock market at once, but spread your entry moment. Don't put all your eggs in the same basket: funds are excellent for this, they spread the risk. A pension savings fund is an ideal instrument for investing a relatively limited amount in the stock market each year. The tax reduction that you enjoy here is a good thing. Take into account the risks you want to take and do not hesitate to seek advice from your banker or advisor. And above all, dare - taking the above into account - to take the first step!
Would you like to know more about how BEAMA as a sector takes on its social role? Then be sure to check the annual report or follow BEAMA via the website www.beama.be.