The growing financial need for financial literacy

Canadians’ debt loads are growing, along with their financial vulnerability. In a time of increasing financial uncertainty, arming individuals and businesses with strong financial knowledge can help strengthen their future prosperity.

In the latest numbers from Statistics Canada, Canadians’ household income increased 1.2 per cent in the last quarter. Great news, right? Not really. During the same period, household credit market debt rose by 1.9 per cent. Put another way, the average Canadian carries $1.68 in debt for every dollar of disposable income. This covers consumer credit, mortgages and loans, for a nationwide total of more than $2 trillion (yes, trillion).

With almost half of Canadians now living paycheque-to-paycheque, even the smallest financial hit can have major consequences. These are some of the reasons CPA Canada’s Financial Literacy program, which is celebrating its fifth anniversary this year, was created.

The federal government now also sees the need for more financial literacy among Canadians and businesses, and, in 2014, named Jane Rooney as its first Financial Literacy Leader and launched various online tools and resources. The combined efforts of all parties are having an impact. According to a 2016 report from the Organisation for Economic Co-operation and Development (OECD) that measured financial literacy, Canada tied for third place out of 29 countries. “We have a lot to be proud of,” says Rooney, on the agency website. “But there are still gaps and we have much work to do.”

CPA Canada’s Financial Literacy program has been doing that work in earnest since launching five years ago. “Our vision includes acting in the public’s interest and contributing to economic and social development,” explains Doretta Thompson, director, Corporate Citizenship, CPA Canada. “Our financial literacy program is doing just that.”

The free workshops and sessions are delivered by a group of volunteer CPAs across the country. What started as a few sessions that reached a total of 1,025 people in 2013 have since doubled each year in size and scope. This year, more than 5,000 volunteers will deliver sessions to 50,000 individuals. Sessions cover everything from teaching good habits to schoolchildren to fraud protection for seniors, managing financial stress, financial basics for new Canadians, small business support, and more. In total, the program has impacted approximately 100,000 Canadians to date and is set to continue its rapid growth in the coming years.

“We plan to expand our online tools and resources, including a financial self-assessment tool that is launching early in the new year,” says Thompson. “We’re also developing a toolkit for millennials and increasing our focus on Indigenous communities and how to support them. Our volunteer program is also expanding.”

The program’s latest ebook, Babie$ (due mid-January), is the first publication in Canada that addresses the true cost of raising a child. “Being a parent is a lifelong responsibility and planning for a child can be complicated,” says Thompson, “but, like all things, planning early can alleviate stress.”

Equipping individual Canadians and businesses with the knowledge to make sound financial decisions can positively impact not only personal finances, but also small business outcomes, local economies, and even workplace productivity and morale. “The CPA profession supports the Canadian ideal of good business,” explains Thompson, “and we’re teaching it.”

For more information on CPA Canada’s Financial Literacy program, visit service-okinwa.info/financialliteracy.

Editor’s note

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