Canadians bothered by their level of financial literacy

Financial Literacy Month takes flight

While seniors (Canadians 65 and older) claim to be most knowledgeable about fundamental financial planning concepts, only 62% say they are comfortable about retirement planning. Among those poised for this next life stage (Canadians 45-64 years), only half (50%) are comfortable with the knowledge they have on this topic area.

“If the student gives themselves a B, it means there is room for more learning,” says Debbie Ammeter, vice president, Investors Group. “We all need to understand the when, where and how of financial literacy.”

Despite the self-awarded B grade, 47% of Canadians say they have enough financial knowledge. Only 27% claim to be well informed, and 44% Canadians say they find financial planning topics confusing.

“The truth is that all of us learn as we go to some extent,” says Ammeter. “Every important life stage and milestone requires a different investment and personal finance strategy to help you achieve your goals.”

Not having enough money to make financial planning meaningful is cited by 53% of respondents as a reason why they have not tried to learn more about financial topics. Other major barriers to learning about financial planning and investing were identified as: intimidated by complexity of choices; no personal contacts to engage in discussion; and lack of time.

Forty-four per cent of Canadians feel the best way to gain financial knowledge is by seeking the advice of a professional financial advisor. Canadians who have financial advisors are most likely to say they are satisfied (60%) with their personal level of financial literacy.

Younger Canadians (44 years and under) are the most likely group to be intimidated by the complexity of financial planning choices available (39%) and 28% don’t know who to ask for information.

Other key findings of the survey include:

• 86% of Canadians say they are very good or excellent at paying bills on time;
• Only 32% are happy with what they save or invest regularly;
• 68% of Canadians say they do not or can not afford to save or invest;
• 28% of women admit they are in the dark or need to understand more when it comes to their financial knowledge (versus 21% of men who feel this way).

The research was conducted by Harris Decima Research for Investors Group in conjunction with Financial Literacy Month to gauge Canadians’ understanding, interest and action in obtaining financial knowledge. In total, 2,503 online surveys were completed nationally between October 20 and November 1.