17 Apr How financial literacy can help us through difficult times
With so many people unemployed or working reduced hours due to the current COVID-19 pandemic, being financially literate is more important than ever. The ability to make smart, effective financial decisions can help many people stretch their dollars further and avoid taking on huge amounts of debt.
However, being financially literate is a skill set that’s lacking in half of Canadians. With four in 10 Canadians reporting that money is a daily concern, and a third of low-income Canadians report worrying about money almost constantly, financial literacy is a vital skill needed by everyone – perhaps more now than ever.
As Canadians continue on this uphill battle during this difficult time, now is as good a time as ever for adult learners to acquire or increase their financial literacy skills.
The Importance of Financial Literacy During COVID-19
Being financially literate gives people the confidence to make informed decisions about their personal finances and create a stable financial life. COVID-19 has put more than one million people out of work, throwing everyone into a tailspin. Even those with adequate financial literacy skills may struggle to make ends meet, which means it will be even more challenging for those without the right skills.
Although being able to effectively budget and manage money is always important, it’s even more so during times of unemployment or reduced work hours. Without financial literacy, individuals risk making ineffective financial decisions, increasing debt and becoming victims of abusive financial practices.
“Having strong financial literacy skills during this pandemic is extremely important,” says Mack Rogers, Executive Director of ABC Life Literacy Canada. “These skills will give people the confidence to contact their bank and ask for a mortgage deferral, practice smart shopping after receiving a government benefit, and identify online financial scams before it’s too late.”
Financial Literacy is Needed Everywhere
From budgeting on a reduced income to shopping at grocery stores, financial literacy is required almost everywhere we go and in everything we do. To become financially literate, a foundational knowledge involving the following four fundamental pillars is necessary:
Budgeting: Depending on how often you receive income, having an effective budget helps your dollars last longer without having to use credit cards or loans.
Saving: Being able to save money makes it much easier to afford large investments such as a car, a home, post-secondary studies and retirement.
Investing: Your money can make more money for you – if it’s properly invested.
Debt: Knowing the difference between good debt and bad debt can help you make the right choices when borrowing money.
Financial Literacy Programs
The world of finance can be intimidating to many, however with the proper resources, anyone can become financially literate. Money Matters is a free, introductory financial literacy program for adult learners that helps provide financial knowledge.
Although typically offered in-person via workshop, ABC Life Literacy Canada is offering all of the high-quality resources online. This allows adult learners to adopt financial literacy skills even during our current time of self-isolation. Written in clear language, the following resources are available:
- Spending Plans Online Course
- Spending Plans Workbook
- Banking Basics Workbook
- Borrowing Money Workbook
- RESPs and Other Ways to Save Workbook
- How to Bank and Save in Canada Online Course
- How to Bank and Save in Canada Workbook
- How to Build Credit in Canada Workbook
- Financial Literacy for the Family Booklet
If you’re looking to offer remote learning opportunities for your learners during this time, Money Matters is the ideal program to keep learners informed and engaged. Visit abcmoneymatters.ca today, or contact us for help setting up a Money Matters workshop online.