Rising personal debt loads and insufficient retirement savings suggest financial literacy education should start at an earlier age in Canada.
A national survey conducted for the Canadian Institute of Chartered Accountants (CICA) finds that 84% of Canadians believe young people are not prepared to manage their finances when they enter the workforce and 85% believe that financial management skills should be taught in schools.
Sixty percent of parents feel they have not been very successful in teaching their children financial management skills and the majority of parents are looking to the financial industry and the government for help in educating their children.
The survey also finds the lack of financial literacy is taking its toll, with 34% of the people surveyed carrying a balance on their credit cards and 12% borrowing money to cover day-to-day living expenses. Among those 55 or older, 40% reported they have not saved enough money for their retirement.
“While many Canadians are receptive to acquiring financial literacy skills, a key challenge will be the delivery of information and effective learning tools,” says Kevin Dancey, FCA, president and CEO, CICA. “A national effort involving the financial sector, educators and government is needed.”
Dancey believes the pending recommendations by the federal government’s Task Force on Financial Literacy will go a long way to making that national effort possible. CICA is currently working on a series of online and offline education initiatives, including community outreach, to advance financial literacy.
CICA’s Canadian Finance Study was conducted by Harris Decima with a national random sample of 1,011 adult Canadians aged 18 years and over and is considered accurate to within +/- 3.1 per cent, 19 times out of 20.
A survey summary report is available at www.cica.ca/flsurvey2010.