As November draws to a close, so does Financial Literacy Month. Say again? Financial Literacy Month? That’s right, this November marked the 15th anniversary of Financial Literacy Month, an initiative led by the Financial Consumer Agency of Canada (FCAC) and promoted by the Government of Canada. If you’ve never heard of it, well, that’s exactly the problem.
Money is complicated, and in today’s environment, pretending it’s not can be expensive. Yet for something so universal, most people are taught surprisingly little about it. We spend our early years learning trigonometry and the periodic table (the periodic symbol for gold isn’t XGD?). Both are useful in their own right, but rarely are we shown how compound interest quietly builds wealth (or debt!), why taxes matter or how to make decisions and habits that align with long-term financial health and freedom.
In a world where financial decisions – from daily spending to long-term planning – shape the possibilities in nearly every part of our lives, the ability to understand money, use it wisely and plan for the future is nothing short of foundational. Teaching financial literacy early, and reinforcing it through early (and even late) adulthood, equips individuals with confidence, stability and opportunity.
Start Early – Building Healthy Habits in Young Children
Teaching financial literacy early plants seeds that will grow over decades. Like most good habits, the earlier you start, the easier it gets, and children begin to form ideas about money long before they ever receive their first paycheque. The conversations we have with our kids and grandkids, like needs vs. wants, saving, sharing and spending, all shape their lifelong attitudes toward money. So, no pressure.
The good news is that teaching financial literacy doesn’t require complex lessons about investing or economics. Instead, it starts with simple, age-appropriate concepts: understanding that money is earned, recognizing the difference between essentials and extras, and learning that saving requires patience and discipline. Even a simple activity, like giving a child three jars labelled Spend, Save, and Share, can plant the seeds of budgeting and goal setting.
These early experiences build confidence. When children understand the basics of money, they feel empowered rather than overwhelmed. They also develop a healthier relationship with spending, avoiding some of the emotional traps many adults fall into. Things like impulse buying, peer-pressure spending (not a fan of those Joneses) or viewing money as a measure of self-worth.
Teens and Young Adults – Preparing for Real-World Decisions
As children grow into teenagers and young adults, financial literacy takes on new dimensions. They begin facing real-world choices, like using a debit or credit card, deciding on post-secondary education, managing their first paycheques, budgeting, and eventually renting or buying their first home. My personal favourite is the introduction to taxes. I still remember the day my 16-year-old daughter asked me why there was money missing from her first paycheque. “Wait, the government can just take it? That doesn’t seem fair.” Ah, yes. Similar words I’ve often spoken silently in my head over the years, but I digress.
This stage of life is where financial literacy has some of its most profound effects. A young adult who understands how credit works avoids crippling high-interest debt. Someone who learns about compound growth early is far more likely to begin investing sooner and reap the benefits. Understanding even basic budgeting helps them resist lifestyle creep and the financial stress that inevitably comes with it.
As they grow, they gain the confidence to ask the important questions at car dealerships and banks, learn to evaluate and use financial accounts like FHSAs and TFSAs to their benefit, and plan with purpose rather than fear. Oh, and for teens who love life hacks, here’s one: Automate a savings strategy and stick to it. Pay and invest in yourself first – it’s a habit that pays dividends, literally.
A Lifelong Skill
Financial literacy is indeed a lifelong skill. It isn’t something you “finish”, but something you continue to grow with. Every stage of life brings its own goals and pressures. As the kids say, “adulting is hard,” and brings with it careers, mortgages, debt, insurance, family expenses and a wide range of savings and investment decisions. Retirees face the challenge of planning for rising costs, protecting and growing their wealth, organizing tax-efficient withdrawals that can support a long and comfortable retirement, and eventually passing those assets on to the next, hopefully financially literate, generation.
At QV Investors, our wealth management team has written about the value of having and reviewing a financial plan. A well-designed financial plan is what often turns financial literacy into meaningful action. Think of it like cooking: knowing what ingredients exist and taste like individually (literacy) vs. following a recipe to create a delicious meal (planning). It provides clarity, structure and direction, helping individuals feel more stable, less worried and more confident about the future. Sounds tasty to me.
In short, financial literacy is not just an asset – it’s a gift. One that shapes families, sets strong examples and creates a legacy of financial strength that can benefit generations.
If someone in your family is starting to take on more financial responsibility, whether receiving a gift, starting a first job or investing for the first time, we’d be happy to support them as they build confidence and good habits. Feel free to connect with us whenever it feels right.
