Money matters: Canadian students get top marks in financial literacy
When it comes to financial literacy, Canadian youth are among the best in the world.
That encouraging finding is the result of the first-ever Canadian participation in a global assessment of youth financial literacy.
Canada came second among 15 countries — tied with Belgium — in the Programme for International Student Assessment (PISA) on financial literacy, recently released in Paris.
Approximately 3,400 students from seven Canadian provinces took part in the survey, which is administered by the Organization for Economic Co-operation and Development (OECD).
According to the results, 87 per cent of these Canadian students demonstrated at least a baseline level of financial literacy, defined by the OECD as allowing them “to participate fully in modern society.”
Twenty-two per cent of Canadian students demonstrated advanced levels of financial literacy — well above the OECD average.
These findings are a vote of confidence in our national strategy for financial literacy, Count Me In, Canada, and reflect the many efforts by provincial governments and other organizations to reach children and youth.
Some of the more detailed findings point to the progress we’re making. They also reveal areas where we can further collaborate to build the financial literacy of our young people.
Canadian students who discussed money matters with parents tended to score higher, with those discussing money matters at home once or twice a week ranking the highest. This aligns with one of our ongoing messages: Start talking with your kids about money early and do it often.
We know conversations at home are crucial, but how do we encourage them?
At the Financial Consumer Agency of Canada (FCAC), where I work, we have a host of unbiased resources available online.
Two examples: our Teaching Children about Money page and our financial literacy database, which is a one-stop hub for programs and activities, many geared toward children and youth.
Another FCAC priority is increasing financial literacy programs for adults in the workplace, in part to encourage adults to share information with their children and to feel more confident about money matters.
We know giving adults a chance to improve their financial literacy will spark better conversations about money at home. To support this goal, we’ve collaborated with the Chartered Professional Accountants of Canada, who developed a financial literacy workshop now being delivered in workplaces across Canada. You can find a link to it on our Canada.ca web page for workplace financial literacy.
Another PISA finding suggests these efforts are paying off: a majority of students demonstrated the capacity to delay gratification.
Sixty-three per cent of Canadian students said that if they didn’t have enough money to buy something they really wanted, they would save up to buy it. Another 17 per cent said they simply wouldn’t buy it at all.
This is a healthy indication that messages about saving are reaching students early in life.
This is good news, as studies show that saving and spending habits are formed at a young age.
The PISA study also found that youth with experience handling their own money demonstrated stronger financial literacy skills. Canadian students who held occasional jobs like babysitting or yard work had, on average, the highest financial literacy scores.
We’re off to a great start. Young people are the future of our economy and today’s teenagers are tomorrow’s financial consumers. With that in mind, the PISA results represent a big win for all Canadians and our economy.