A few months ago I asked you to share the most important financial lesson you learned as a teenager or young adult just starting to manage your own money. I received dozens of insightful replies on the blog, Facebook, and on Twitter. Here are just a few of the wise answers you gave:
“Want and need, know the difference and you will save money.” – Marjorie
“So important to teach financial literacy at an early age. We never really discussed money with our kids and it was a big mistake. They grew up not really understanding financial responsibility.” – Monica
“You can either spend your money now, or save for ‘something great’. That something great ended up being a house.” – Jenna
“Hm, the first thing I ever learned was making your money work for you… Investing. Not just in stocks, bonds, and resources, but investing in people and charities. My nanny set my sister and I up with bank accounts where we invested our savings (money received for birthdays or special occasions; my family did not believe in allowances). We chose where to put the money and it grew from the time we were 5 years old. But she also taught us to invest in charities and people, because what we got back was a hundred fold through societal progress!” – Aliya
“One thing my husband and I agree on now that we’ve finally mastered the whole ‘budget’ concept is that our parents weren’t open enough about money. Neither of us knew what kind of salary it took to support a family and a home and a car, etc. but money talk was a bit taboo around the dinner table.” – Lindsay
Clearly, you all recognize the importance of early financial education and talking about personal finances. With my own girls we’ve started by giving them an allowance and guiding them to save and spend their money wisely. The idea is to help them learn valuable skills like saving and budgeting from the very start. Of course that’s no guarantee they’ll never get into financial trouble, but I trust that the skills they learn now will help them succeed in the future no matter what comes their way.
The Financial Literacy Gap
The need for financial literacy education is a concern for more of us than we might think . A recent Capital One Canada Financial Education study suggests that half of young adults going into post-secondary school admit to feeling unprepared to manage their finances. Even though 58% of Canadians agree that talking about finances with friends, family, and professionals is the best way to learn about effective money management, 53% are still uncomfortable talking about their own finances.
83% of Canadians think there isn’t enough financial education in school, and 75% wish they had started learning to manage their money at an earlier age. I agree!
Financial literacy is a critical skill we all need to be successful in our lives, regardless of the career or vocational path we choose. My first experience with personal financial planning came in university when I got a crash course in learning to budget my rent and expenses. Thankfully I already had skills learned from home and school, but despite this there were still some months along the way when things were tight and I had to borrow money to pay the bills.
It’s so easy to blow your budget and end up in a financial mess that can take months or even years to dig your way out of. Wouldn’t it be better for all young people to have access to comprehensive financial education and skill development before heading out on their own?
Capital One Financial Education Challenge
I believe in the importance of financial literacy education, and that’s why I support the work that Capital One has been doing in partnership with Enactus Canada. The Capital One Financial Education Challenge encourages students from across the country to develop and deliver projects in their local communities to improve financial literacy. Students work to empower people to make informed financial decisions, ultimately improving their lives in an economically, socially and environmentally sustainable way. Since 2006, this challenge has engaged 7,125 students across the country, resulting in the delivery of 779 financial education outreach projects and directly impacting 115,950 community participants.
If you recall, I told you about the work my hometown Enactus SFU project and Western Canada regional finalist, Count on Me, is doing to help disadvantaged youth in Vancouver learn financial literacy and employability skills. I’m so pleased to let you know that Count on Me went on to win the Capital One Financial Education Challenge this past May. Congratulations!
Another regional finalist, Project SucSeed from the Enactus team at Memorial University in Newfoundland, was crowned overall national Enactus champion and will go on to represent Canada during the Enactus World Cup taking place in Toronto this month from September 28-30, 2016. SucSeed is a unique financial literacy training and microloans program helping fresh produce growers in rural Labrador purchase and utilize hydroponic systems. The hydroponic systems are built by at-risk youth, providing them with valuable work experience and salaries.
I hope you’ll join me in cheering on our Canadian team! Check out all the financial literacy projects developed by Canada’s top six regional finalists, and learn more about Capital One’s financial education programs here.
What financial skills and knowledge do you think young people need to know when they’re just starting out?
Disclosure: This is a sponsored conversation. Nevertheless, all opinions expressed are completely honest and my own, based on my personal experience. Your experience may differ.