financial literacy

New Ways to Deliver Financial Literacy

FINANCIAL LITERACY MONTH

This week I took a break from promoting financial literacy and presented a webinar on E-newsletter management and the importance of blogging as part of ​Haltech’s​ ​Marketing Masterclass Series​. I presented to 25 eager entrepreneurs and it was great to improve their literacy on these 2 important forms of marketing.

I have to admit though, the whole time I wanted to raise the subject of financial literacy.

Throughout this 10th anniversary of Financial Literacy Month, we at Content Innovo have tried to stress that the resources needed to improve your financial literacy are readily available. There is no reason to remain ignorant of banking, investment and finance if you live in Canada… for the most part.

In this last blog to promote financial literacy, I would like to reach out to the Canadian banking industry and challenge them to find new ways to deliver financial literacy to all of  their customers.

THE CHALLENGE

We have learned that not everyone in Canada learns the same way. How you receive and adopt information affects how you will respond to certain learning tools. I would like to see the Canadian banking industry offer tailored learning resources that address the needs of a diverse population.

I challenge the Canadian banking industry to address these gaps.

NEW IDEAS

I am yet to see a bank offer a quiz so that a person can assess their level of understanding of personal finance. Nor have I seen a comprehensive video series or masterclass provided by a Canadian bank aimed at financial literacy. Some people prefer to learn through video and in this day and age – video rules.

Resources tailored to lower-income Canadians and newcomers are also needed

If you agree let me know and please let me know what you think of our efforts to raise awareness about the need for tailored financial literacy solutions in Canada.

Please follow us on social media this month as we highlight financial literacy resources for all Canadians.

https://twitter.com/ContentInnovo

https://www.linkedin.com/company/content-innovo/

Understanding how Finance, Banking and Investing Works

FINANCIAL LITERACY MONTH

We are almost at the halfway point in the ​10th annual Financial Literacy Month here in Canada. A quick search on Twitter for the term Financial Literacy Month will net you a bevy of resources, comments and links aimed at individuals and the advisory community.  Resources on finance, banking and investing are provided by companies like Content Innovo, government bodies and of course, financial institutions.

THE END GOAL

At Content Innovo the end goal in participating in financial literacy month is to see a Canadian population that is financially healthier because they understand how finance, banking and investing work. We believe we live in an age where upward mobility and financial health are achievable through the resources that are readily available.

Next year we’ll be looking for partners to help us take our efforts global. Stay tuned.

ASSESSING PERSONAL FINANCIAL HEALTH

Perhaps you would prefer a financial advisor to run this assessment for you but for a financially literate person, this should be no problem. When assessing your financial health you should look at 6 things: Net Worth, Savings Rate, Debt-to-Income Ratio, Credit Score, Retirement Fund, and Income.

If you’re not familiar with some of these terms check out this article: ​MEASURE YOUR FINANCIAL HEALTH. The article is aimed at a US audience but the same rules apply.

If you’re interested in digging a little deeper into your financial health, Sunlife provides a more in-depth calculator to help you plot your future.

The bottom line is, the tools to assess your financial health are readily available – but – would you not feel more comfortable negotiating a loan or choosing an RESP if you understood the in’s and outs of those products and the options available?

Being financially literate is as important as a gym membership, a career you can be proud of and a healthy family.

Feel free to use the resources mentioned in this blog to assess your own financial health and share with us any areas that you feel need improving. We’d be happy to connect you with the right resources to improve your financial literacy and ultimately your financial health.

Please follow us on social media this month as we highlight financial literacy resources for all Canadians.

https://twitter.com/ContentInnovo

https://www.linkedin.com/company/content-innovo/

The Month Ahead

Last week, I set the stage for Content Innovo’s campaign to support Financial Literacy Month. This November, Canada celebrates the 10th anniversary of Financial Literacy Month.

There has seldom been a more important time to discuss financial literacy, as the global pandemic has forced people to take greater control of their financial lives.

THE STATE OF FINANCIAL LITERACY IN CANADA

I want to set the stage for the month ahead by assessing how well Canadians understand finance, investing and day-to-day banking.

According to an Organisation for Economic Co-operation and Development (OECD) Survey measuring Financial Literacy and Financial Inclusion, Canada ranks 3rd out of 29 countries surveyed. Only France and Finland scored higher.

But, comparing as vast and as diverse a country as Canada to other nations doesn’t tell the whole story. Overall, Canadians score high on their understanding of finance and investing but how do newcomers to the country fair? What about the working poor and marginalized communities? Is there a gender gap that needs to be addressed?

Luckily, the Canadian Centre for Financial Literacy (CCFL) has been looking at the problem and trying to develop a clear picture of what Canada needs to do to teach financial literacy to those groups that are underserved and most in need.

WHAT THEY’VE LEARNED

Since 2004, the CCFL has been researching the following question: Does financial intervention have a positive effect on Canada’s poor and marginalized citizens? You can read the full findings in this report.

According to the report, Canada has a large professional financial advisor community. Unfortunately, Canada’s poor and vulnerable communities often can’t afford to access these services and in many cases, the advice given isn’t appropriate for their circumstances. Therefore, there is a gap in access to financial education, as well as access to financial services.

The report further states that not enough evidence has been collected to prove that early education works, but the signs are positive. Most of the evidence provided for the report was anecdotal, so more research is required.

The thing that most struck me about the report is that there is growing evidence that the problem is not access to financial literacy, but the delivery system for those resources. In fact, the way we introduce financial literacy to impoverished and marginalized Canadians is part of the problem.

For the delivery system to change, the Canadian government needs to hear from all Canadians. And now, you can have your say. The Canadian government is conducting a financial literacy survey, and you can give your opinion on how Canada teaches financial literacy to future generations by clicking here.

Please follow us on social media this month as we highlight financial literacy resources for all Canadians.

https://twitter.com/ContentInnovo

https://www.linkedin.com/company/content-innovo/

Content Development

Blog: Improving Financial Literacy From the Ground Up

As many as 90% of business failures around the world are due to poor financial management. Not marketing or labour problems, but simple, old-fashioned bad management. So how do we resolve this problem? We go back to basics and concentrate on financial literacy from an early age.

 

Too many individuals, young and old, simply do not have a basic understanding of things like budgets, inflation and interest rates. Although it’s unrealistic to expect everyone to possess sophisticated financial knowledge, some financial know-how is essential for making important life decisions related to money.

 

Building personal financial capabilities early in life can give people the foundation for financial well being in the future. Schools are an important channel to improve financial literacy. Studies in the U.S. have shown that financial education, when done properly, leads to an improvement in financial behaviour.

 

But there is still a long way to go. According to a survey of 13 million U.S. high school students, only one in six received mandatory financial education. And only 17 states require personal financial content to be included in educational curricula.  

 

Of course, people want to make good financial decisions that set them up for success, but many have never had the opportunity to learn how. For instance, a significant number of American adults can’t pass a basic financial literacy test with three questions on stocks, interest rates and inflation.

Here’s a sample question:

 

Suppose you had $100 in a savings account and the interest rate was 2% per year. After five years, how much do you think you would have in the account if you left the money to grow?

 

  • More than $102

  • Exactly $102

  • Less than $102

 

Although 43% earned scores of three, meaning they correctly answered all the questions, and another 36% received scores of two, 21% got only one or zero questions right. Across all households, the average score was 2.2. Considering that the questions are relatively simple, those scores demonstrate why financial literacy needs to be prioritized by governing bodies, individuals and organizations throughout the world. (The correct answer in the sample question, by the way, is more than $102.)

 

In Canada, the Ontario Working Group on Financial Literacy concluded that students need to be financially literate to make more-informed choices in a complex and fast-changing financial world. Financial literacy education provides a critical set of lifelong skills, the report added. To that end, the group recommended that teachers be given professional training and resources to increase their knowledge of financial literacy topics that can be passed on to students. In addition, the report suggests that parents and families be invited to participate in the development of their children’s financial literacy education.

 

Financial literacy can be a hard sell for educators, who may not see the importance of adding it to the curriculum. But it is an important skill to help set young people up for success throughout their lives.