Yes, Financial Literacy Is a Problem—That’s What Advisors Are For

"It's about understanding the basics, so that when I say I'd like you to put 30% of your money into a class of investments like stocks or bonds, if I use a word like 'cash' you know it may be a money-market fund. "If I talk about a muni bond, you know I'm talking about debt," Lee continues. "Then when we talk about asset allocation, we have a certain amount of money in stocks, bonds, money-market funds and cash, and why that is important. From there we can become a little more granular."

Despite the efforts of financial literacy promoters, or perhaps as an indicator of their inefficacy, financial concepts and products with which financial advisors work daily are often quite bewildering to non-professionals.

Lee advises on a number of corporate 401(k) plans, and regularly goes over the basics at quarterly meetings, and in meetings with individual participants.

"We approach planning from a goals-based wealth management strategy," Lee says, meaning he does not map out a plan before ascertaining "what is important to [the client] in the next one to three years; in the next three to five years; and for five years and beyond."

In his more than a quarter-century of advising, Lee has seen an impact from his educational approach.

"I think about the families I have that have children at an early age that learned about investing and saving. What I have seen is that those offspring tend to be more responsible—better savers."

"To watch a client achieve his or her goal—that's the real reward that I receive," he adds.

While that next generation of clients is already opening up 529 accounts for their kids, in some instances, the financial literacy Lee had a hand in initiating took deeper root:

"There was a young man that I had spoken to 20-plus years ago," he says. "He went on to become a money manager out in San Francisco. There was another young lady who was the daughter of one of my clients. Her parents asked me to speak to her, and she went on to become a financial advisor down in Florida; that was very rewarding."