Lessons In Financial Literacy
The federal government launched a Financial Literacy Task Force in the Ontario school system last June
. It is aimed at their grade 4 to 12 students in hopes of teaching them how to avoid the financial debt Canadian's are currently experiencing due to the Great Recession. It's a life lesson many Canadian's missed out on before account balances plunged deep into the red. The hope is that a financial literate population will create more stability in the economy.
The Financial Literacy Task Force will be responsible for integrating financial lessons into the schools by teaching young people how loans and credit work. After a 20-year trend of increasing household debt due to reduced saving, dwindling pension plans and easy credit, financial planning must be integrated into the minds of Canadians.
It is hoped that by educating children about money matters will help avoid some of the mistakes many of their parents have made and inadvertently taught their kids. The financial mind-set has gone from 'Can I afford it?' to 'Can I afford the payments?' Our perspective on money has really changed over the last two decades and these bad habits are being taught to children who have very little exposure to managing money or budgeting.
It is important to sit down with your children and involve them in the family budgeting process, explaining to them what a budget means and what happens if you become in debt. Incentives can be offered for them to help their family cut back on expenses such as heating bills or telephone and cell phone bills. Parents can also help their children learn about saving by putting away a small portion of their allowance each week, teaching them how to save for a larger purchase. This will help them be able to make sound decisions, manage money and eventually, handle credit.
A recent Harris-Decima poll found that 60% of baby boomers are currently supporting their adult children. Even though they expected their children to be financially self-sufficient by the age of 21, many have admitted it will most likely be delayed until they're 25. Older members of the demographic, referred to as Generation Debt, are accumulating debt at an alarming rate.
Some of this younger generation are taking on a massive amount of debt to get a post secondary education which leaves them financially loaded down once they graduate, seeing 20% of them moving back home. Teaching your children about financial responsibility is necessary in today's world. If you need help or advice due to bad credit or would like to consolidate debts, there are private financial lenders who specialize in bad credit loans. They could be the answer to helping you now, and your children in the future.
by: Molly Wider
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