Financial Literacy

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Financial Literacy

Money Management: Learn from the Experts Dragons’ Den’s Vincenzo Guzzo and Wes Hall weigh in on the importance of financial literacy for all Canadians.

Why is financial literacy important for young Canadians?

GUZZO: With the cost of living reaching an all-time high, young Canadians must develop and smartly use financial skills, which means having the ability to manage personal finances, plan, budget, and even invest. Financial literacy should be taught, and early on! It's the key to building a healthy and fruitful relationship with money.

HALL: Financial literacy pops up in all aspects of our lives very early, from how much to pay for a game, and whether it's wise to spend money on popular video game sites without any tangible returns, to what you do with that money you made selling lemonade. Do you put it in a piggy bank or do you invest it in a financial instrument that can allow the money to grow?

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What's something you wish you could tell your younger self when it comes to money management?

GUZZO: The movie business has always thrived, but the pandemic served as an unprecedented life lesson. I would tell my younger self to plan for rainy days no matter what.

HALL: Saving isn't just about putting money in the bank but about how you make that money work to your benefit. I recall in my younger years I would spend every cent I earned as it came in. But in my early twenties, I realized that the value of building equity was far greater than that of mindlessly spending.

Why is it important for Canadians to invest in their wealth?

GUZZO: Simply saving money may help in case of emergency spending. This has its obvious merit, but it's limited. Smart

investing is the way to put Canadians’ money to work, outpace inflation, and potentially build their wealth. It’s a question of security and peace of mind.

HALL: It's not just about driving a nice car or living in a nice neighbourhood. Wealth allows you the flexibility to tackle important social issues through philanthropy, whether that be education, health care, or racial justice. Let’s say you're from an underserved neighbourhood ­— you can then use your wealth to help others in that neighbourhood escape poverty. If you came from poverty, it's important that you return and help as many people as possible.

Wealth allows you to pay that forward.

What are your top money management tips for new businesses?

GUZZO: Make sure you have the money before investing. Be organized and focused. Keep a record of everything. Patience and tenacity are key. Surround yourself with talent (you can’t be good at everything.) Invest in the people you hire. And know this: you will work harder for yourself than you would for anyone else.

That means that you'll sacrifice a lot in order to start and develop your business. Make sure you’re ready to take that on.

HALL: Watch the bottom line. In translation: watch how much money you earn versus how much you spend. Many business owners focus on the money they bring in (revenue), which is fine to an extent, however, though you may be doing a good job bringing money in, only governments can spend more money than they make and stay in business. Don't overspend on anything.

Learn more from all the Dragons! Read the full Q&A with Manjit Minhas, Vincenzo Guzzo, Arlene Dickinson, Wes Hall, and Michele Romanow on innovatingcanada.ca.

Dragons' Den is now streaming on CBC Gem.

5 Financial Literacy Tips You Should Know About

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our in 10 Canadians report that money is a daily concern, and a third of low-income Canadians report that they worry about money almost constantly.

November is Financial Literacy Month, which raises awareness of the importance of financial literacy skills. Financial literacy skills have the power to improve confidence around financial decisions.

Money Matters is a free program that aims to build these skills.

Here are five financial literacy tips from participants of the program: 1. Ask yourself if the item you “need” is actually more of a want than a necessity. If you still think you need it, wait 14 days before purchasing to see if it’s really that important.

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2. Put some money away. Putting just $50 a month away in an RRSP can make you $500,000 if you start before you’re 30.

3. Don't be afraid to borrow. Borrowing money isn’t always bad, especially if you’re using it to buy something like a house.

4. Talk to people who are more knowledgeable about money.

While it might seem daunting to ask people about money, you shouldn’t feel bad about asking simple questions. By asking them why they made their financial decisions, you’ll become more confident in making your own decisions.

5. You don’t have to put all of your investments in “high-risk” or “low-risk” stocks or mutual funds. You can diversify your investment portfolio.

For more information about Money Matters or to access free resources, visit abcmoneymatters.ca.

This article was made possible with support from ABC Life Literacy Canada.

Publisher: Rayan Hassan Business Development Manager: Melanie Kosev Country Manager: Nina Theodorlis Content and Production Manager: Raymond Fan Designer: Kylie Armishaw Web Editor: Karthik Talwar All images are from Getty Images unless otherwise credited. This section was created by Mediaplanet and did not involve The National Post or its editorial departments. Send all inquiries to ca.editorial@mediaplanet.com.

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P H OTO C O U RT ESY O F A DVO C I S

As Financial Literacy Arrives in Ontario Schools, Parents Consider Their Role Advocis, The Financial Advisors Association of Canada

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he Ontario government recently introduced financial literacy to the school curriculum. Many kids enter university and the real world without acquiring any knowledge of banking accounts, budgeting, investments, and how credit works.

Perhaps their parents and caregivers weren’t the best financial role models or they just figured their kids would pick up financial tips on their own someday.

As part of the curriculum, students will have lessons about earning, spending, saving, donating, credit, and debt. They’ll also learn about paying off a mortgage, calculating interest rates, exchange rates, setting financial goals, and so on.

In the primary grades, a common math problem is calculating whether they have enough money to afford three or more items of varying prices. Some problems also ask the student to calculate how much they would have left over if they made a purchase.

When helping their kids with homework, parents could expand those themes. Ask your child what they would do with the leftover money. The answer may be a simple (“spend it all on candy”) but this reply can lead a discussion on goals for our money, needs versus wants, and delayed gratification. For example, can your kid come up with other solutions for the extra cash beyond making a purchase?

Learning by doing is the best teacher. Kids need some money of their own to best learn how to manage it. Let them make their own

buying decisions and learn by trial and error whether their purchases were worth the cost or best to skip next time. You can start by giving them a weekly allowance either on its own or for doing chores and household errands. Some families follow a spend/share/ save model that allows kids to buy what they want now, donate to a charity of their choice, and save up for a bigger-ticket item.

Learning by doing is the best teacher.

Kids need some money of their own to best learn how to manage it.

Work with your kids to develop their own plans for their money. Advocis, The Financial Advisors Association of Canada, recently created the Junior Financial Advisor (jFA) Fin

Lit Kit, a kids' activity book, to spark detailed money conversations. Younger kids will be happy with the word searches and colouring sheets, while older kids can think some more about how to make their financial goals a reality.

But teaching moments are everywhere.

While shopping at the mall, younger kids may observe you using a credit or debit card and come to the conclusion that you get money from simply tapping a card. That can lead to a chat on where money really comes from, how it’s earned, and how you qualify for credit.

Kids can also learn about money on the platforms they love best. If your kid avidly uses Roblox, show them the jFA Financial Quiz & Obby, a financial literacy game. It was amazing to see my eight-year-old’s avatar navigate through this game’s mazes. And for her to advance to the next level, she needed to correctly answer multiple-choice questions about money. I thought she would be stumped by one question on credit cards and how to avoid interest charges, but she picked the correct answer about paying off the bill every month. What made her select that answer? “It’s just obvious,” she shrugged, as she recalled me talking about paying bills.

Hopefully it’s an answer she’ll remember when she has her own credit card someday.

For more information, visit financialadvice forall.com.

This article was sponsored by Advocis.

Tips to Go From Zero to Hero With Your Money Today Everyone has had issues with their financials before.

Here are some tips on how to set your life up for long-lasting success with money.

Nathan Kennedy

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veryone knows they should be better with their money.

If you aren't doing the below (or some version of it), you shouldn’t be worrying about bitcoin or the stock market yet. Here's how you can start from nothing and create a fantastic base incredibly quickly:

Yes, We Can Change the Future!

With the right training and education, we can equip the next generation for a life of financial confidence.

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he majority of Canadians never received any financial education — especially for the rapidly-changing financial world that has evolved around them. Unfortunately, we live with that legacy. Many Canadians live with persistent financial stress and anxiety — not by design or intent, but rather from having to manage financial life affairs with little in the way of education and training to help.

The past is the past.

However, we can change the future by educating our kids and preparing them for their future financial decisions and responsibilities.

Our actions in life are Gary Rabbior influenced by many facPresident, tors. A significant one is Canadian our level of confidence. A Foundation for Economic Education confident person is more likely to ask questions, recognize when they need advice from others, set their own debt limits, establish goals they aspire to and feel they can achieve, and stay in control of their financial lives.

We can do a lot to build financial

Start consuming content This is the easiest tip and yet it may be the most impactful. In fact, you're already doing it right now! Consuming content, even passively, on how to better your money (via articles, YouTube, social media, podcasts, audiobooks, and so on) is a fantastic way to not only build your knowledge but to create a deep, burning desire to want to sustainably improve your finances.

Nathan Kennedy Host & Owner, The New Money Podcast

Write out income and expenses confidence and competence in the adult generation of Canadians today. We can try to help them contend with, and hopefully alleviate, the situations of financial stress and over-extension in which they find themselves.

But the future is sitting in our classrooms today — and on the baseball diamonds, in the hockey rinks, on the dance floors, at the malls, and on the couch in the basement. We can change those futures — and dramatically reduce the number of Canadians living lives of financial stress and anxiety in the future. We can increase the numbers living within their means and experiencing the happiness and contentment of life that can come with that.

But we have to act now — taking steps to educate our kids and build their financial confidence and capability to enable them to feel confident, act with confidence.

For more information, visit cfee.org.

This article was made possible with support from the Canadian Foundation for Economic Education.

This is the part everyone dreads, and yet it’s so necessary. If done well, you'll likely only have to do this once and then iterate/improve it as you go. Write out your monthly income and expenses on a sheet of paper. You can use a laptop if you would like — however, I believe that pen and paper are more effective with sketching out ideas. They really make you feel everything. After you’ve done a rough sketch, review your transactions using your banking app to further inform how accurate your initial assessment was and make adjustments as necessary.

Set goals and budget for spending (while being realistic!)

Now that you have a clear picture of where you are financially, you can begin to set SMART (specific, measurable, achievable, relevant, and time-bound) goals as to how you would like to improve and craft a budget to get you there. Make them reasonable. Everyone wants to be a millionaire right now but we all need to start somewhere.

As for how to set up a budget, think about a reasonable number for food, bills, leisure, and miscellaneous expenses, then add a 10 Strategize how to improve to 20 percent margin on top to account for potential overspending. I suggest writing Analyze what your current this out, similar to the initial audit, and situation is beginning to pay yourself first and incorporPick a system to monitor ating this “expense” into your budget. This your progress means setting up an automated deduction into your investment and savings accounts.

Automate and iterate

Read more about the following tips online:

Take one step at a time. You’ve got this!

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