Take this self assessment quiz and see how you stack up!
And secure your free credit score.
- The Rule of 72: do you know what it is?
- Pay Yourself First: ever heard of this maxim?
- $1.00 per day at 10% over your lifetime: how much can it grow to at age 65?
We’re offering this mini test because….
During Financial Literacy Month, Canadians are encouraged to invest in their own financial well-being and strengthen what we call ‘financial literacy’. The fact is, only 61% of Canadians describe themselves as financially literate, or ‘being able to understand and effectively use various financial skills’.
Often, many have a poor understanding of healthy financial practices. For example, in the 90s, the average Canadian owed just 85 cents per dollar they earned after taxes. Today, that number is $1.70. Also in 2019, the average Canadian household debt was $72,950. Or, $23,800 if you take out mortgage debt. That’s about $24,000 in credit card, loans and lines of credit!*
On top of it all, these have been some of the most challenging years on record for many Canadians due to the economic impacts of the COVID 19 pandemic.
Canadians it seems aren’t as financially literate as we could be. Many possess low or inadequate knowledge and ability to make good financial decisions. Consequences are things like prolonged debt, low credit scores and lack of savings. This can affect anyone, it doesn’t discriminate based on income or education level and can infiltrate every aspect of life.
6 Key Steps that can Improve Your Financial Literacy:
- Review Your Finances: what’s coming in and going out. WRITE it all down and get a clear picture of your financial situation, as accurately as you can.
- Discover if you’re making financial mistakes: do you have an emergency fund? Can you live within your means? Do you make late payments on your bills?
- Manage credit effectively: only use credit cards if you have the cash to pay them off. Try paying even a little more than the minimum balances. Check your credit score!
- Make a budget and document it. When you write something down it’s much harder to ignore. Get your financial plan on paper.
- Discuss your finances with family or an advisor: two heads ARE better than one. Get perspective and help to implement your financial plan*.
Keep learning! Take control from Youtube channels to podcasts to forums and subreddits about money, the possibilities are limitless.
*Sources: Government of Canada Financial Consumer Agency of Canada, Borrowell, Refresh Financial