I spent most of November in Toronto celebrating Financial Literacy Month. I teamed up with Tangerine – my bank of seven years! I have been banking with Tangerine since 2009, and have made them my primary bank because of their no-fee daily chequing account and their high-interest savings accounts. I’ve also been investing in their Tangerine Investment Funds for years. I love the flexibility, accessibility, and availability of banking from Tangerine, which is why I was so excited to work with them for November!
We kicked off the month with a live financial literacy workshop for millennials at BrainStation on November 3rd, where I provided my tips on budgeting, paying off debt, saving and getting started investing.
Financial literacy is a lifelong lesson
Many people feel overwhelmed by the amount of information they believe they need to know to manage their money. A recent survey by Tangerine found that only half of Canadians surveyed consider themselves knowledgeable about personal finance. We have more options to choose from when it comes to banks and financial products, and it’s easy to feel overwhelmed by the complexity of all aspects of money management.
But you don’t have to master it all right now.
Try starting with something like creating a budget or setting up an automatic savings plan for retirement. Once you master one task, you can move on to the next, which for some might mean opening an investment account. It’s not very realistic to try to learn everything about money in a single day, but if you commit to learning as you earn, spend, and save more of it over the years, you’ll be on the right track to reaping the rewards!
My primary bank, Tangerine, is committed to helping Canadians live better financial lives, by offering financial literacy resources to help you save more and invest for the future.
Financial Literacy is important because it’s the part of the equation you can control
Low savings rates and high debt loads are fuelled by Canada’s current low interest rate environment. With interest rates at all-time lows, debt is cheaper to carry than ever and many people find it easier to spend than save. Some of the contributing factors to ongoing financial vulnerability of Canadians include:
- The ubiquity of credit cards. 89% of Canadians have at least 1 credit card, and plenty of them carry a balance. The typical Canadian owes $21,348 in consumer debt.
- The rise of seven- and eight-year car loans. In the past, car loans were typically for 3 or 5 years, but now you can finance your vehicle for as long as 8. This leaves drivers underwater on the loan for almost the entire term. In fact, most people never pay off their car loans – they simply roll the remaining debt into a new vehicle loan when they buy a new car!
- Canada’s overheated housing market. High home prices translate into high mortgage balances. Many people rush into home ownership, eager to get their foot in the door of the real estate market, only to be saddled with large monthly mortgage payments that prevent them from paying down other debt or saving for retirement.
- Fewer employer pensions. 47% of Canadians have no employer pension, and that number is even higher for younger workers. As a result, Canadians have less retirement savings than ever.
You can’t control these external financial forces, but you can control how effectively you manage your money, and that begins by knowing how.
Understanding how credit works, how to manage debt, how to invest, and how to make a budget (and how to stick to it!) can maximize your financial success even when it’s all too easy to be led astray.
Disclaimer: this post was sponsored by Tangerine, however the views and opinions expressed are my own.
Tangerine is a direct bank that delivers simplified everyday banking to Canadians. Tangerine offers banking that is flexible and accessible, products and services that are innovative, fair fees, and award-winning Client service. From no-fee daily chequing to high-interest savings accounts, GICs, RSPs, TFSAs, mortgages, a Credit Card, and mutual funds through its subsidiary, Tangerine Investment Funds Limited, Tangerine has the everyday banking products Canadians need. You can learn more about Tangerine here.