Credit Canada

A federal task force will help Canadians become more financially literate in a year when many are drowning in debt.

OTTAWA — Laurie Campbell has devoted much of her adult working life to the agonizing task of helping Canadians who are drowning in debt.

"The people we see often have hit rock bottom," the veteran credit counsellor says, making no attempt to conceal the frustration that goes with the job.

"It seems to me individuals don't seem to understand the basics of how to borrow, or the impact of borrowing that they do."

Although Campbell says she cannot imagine demand for credit counselling ever drying up, she is hopeful the coming year will be a turning point in the quest to make Canadians better consumers, savers and investors.

Campbell and a dozen other people with expertise in money matters and education are members of a federal task force that has until December to come up with a national strategy for strengthening financial literacy in Canada.

The work of the all-volunteer panel will put a spotlight on how well-equipped individuals and families are to navigate activities such as financing a new home, paying down mortgage and credit card debts and saving for retirement.

There is no shortage of information online and off to help people make responsible financial decisions. Plenty of financial literacy work is also going on in some schools and in volunteer groups. Financial skills instruction is a mandatory subject, for example, for all Grade 10 students in British Columbia.

There are online quizzes to teach and test financial literacy, among them The Money Belt and The City, Financial Life Skills. Financial literacy groups also are springing up in communities across the country. Among them is the Edmonton Financial Literacy Society, which explains its raison d'etre this way: "Because money does not come with a manual."
But many Canadians do not bother to take advantage of the wealth of available information, Campbell said.

The federal task force is charged with developing a strategy that will allow greater collaboration among groups involved in the financial literacy effort, as well as with finding ways to encourage more Canadians of all ages to take advantage of opportunities to become more financially savvy.

The panel will conduct public consultations this spring in all regions of the country to ask people what they want and need to know about everything from saving and borrowing to the psychology behind overspending.

It hopes to kick start a "national conversation" by releasing a consultation paper, probably by the end of February.

Campbell, executive director of Credit Canada, said that based on her experience, financial literacy education needs to begin at square one.

"It's really Money 101," she said in an interview from Toronto. "We need to look at the basics and help people understand how the credit system works, how to manage better when they are using credit, understanding the difference between needs and wants, how to make informed decisions and how to make planned purchases."

Campbell also said it's probably never too early to start the training.

Children at a "very young age" are starting to grasp the idea of money and why they want to have it, she said, so they should be taught early about saving and the cost of borrowing.

Campbell added, however, the first priority should be ensuring parents, teachers and other influential people in children's lives are financially literate.

"We want to educate Canadians as a whole," Campbell said. "We can't just concentrate on the young people."

Campbell figures the task force's work is coming at a good time because the economic recession has been a wake up call for many Canadians, many of whom are "two paycheques away" from financial disaster.

"Even those who have not lost their jobs are thinking very carefully about how they manage their own money right now," she said.

"Our grandparents were right when they said, 'Save for a rainy day.' They knew what they were talking about. It's not old fashioned.

* Material reprinted with the express permission of Canwest News Service.