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FCAC's Financial Literacy NewsLetter

If you would like to share a financial literacy success story with FCAC, please contact Martine Bélanger: martine.belanger@fcac-acfc.gc.ca.

FCAC establishes a new partnership to offer financial literacy workshops to post secondary students across Canada

In response to widespread interest in improving young people's understanding of basic financial concepts and their real-life applications, the Financial Consumer Agency of Canada (FCAC) and the Investor Education Fund (IEF) partnered with the Association of Canadian Community Colleges (ACCC) to offer financial literacy workshops at 10 colleges across the country.

Many young people get their first experience managing finances when they go away to college or university. Post secondary students are, in many cases, at the age where they can apply for loans, credit cards and other financial services. At this stage of their lives, it is crucial that they learn and understand the fundamentals of financial products and services in order to avoid making costly mistakes.

The Financial Basics workshop offers young adults a learning experience on financial topics of vital importance and teaches them money management skills for life. These topics include creating a budget, managing expenses, credit and debt management; protecting yourself from fraud; and saving for the future.

In March 2011, the following colleges delivered Financial Basics workshops in French or English as part of the project: Algonquin College (Ottawa, ON), Assiniboine Community College (Brandon, MB), Collège Acadie Î.-P.-É. (Wellington, PEI), Conestoga College (Kitchener, ON), La Cité collégiale (Ottawa, ON), Nova Scotia Community College (Halifax, NS), Parkland College (Melville, SK), Seneca College (Markham, ON), St. Clair College (Windsor, ON) and the Vancouver Community College (Vancouver, BC).

Several hundred participants took part and most colleges plan on offering the workshop again based on the interest and positive feedback it received. "I found the Financial Basics workshop very interesting and helpful in many ways. At 19, I learned the importance of managing and saving money and steps on how to do it no matter where I am at financially. I think this course would benefit all young adults who want to be more aware of how to spend money wisely and save, so they can feel safe and secure for their future plans and goals." – Amanda Tarr, Yorkton Community College (Parkland College), Yorkton, Saskatchewan.

Financial Basics was developed by the FCAC and the IEF, in collaboration with Ellen Roseman, financial author and journalist. For more information or to order Financial Basics workshop materials, visit: www.fcac-acfc.gc.ca.

 The Canada Student Loans Program offers flexibility in repayment

For many students, the prospect of finding a job and repaying their student loans once they have completed their schooling can be intimidating. That's where the Canada Student Loans Program can help.

A Canada Student Loan has a couple of advantages over private loans. First, eligible borrowers don't have to make any payments while they're studying and for the first six months after they graduate, or leave school; however interest does accumulate during this six month time period. Second, if a borrower is having trouble making ends meet, they can get help with the Repayment Assistance Plan (RAP).

Under RAP:

• Affordable student loan payments are based on the borrower's family income and family size;
• No payment will be required from those with very low incomes;
• Monthly payments are limited to no more than 20 per cent of a borrower's income; and
• No borrower will have a repayment period of more than 15 years, or 10 years for borrowers with permanent disabilities.

Borrowers who experience difficulties repaying their Canada Student Loans, should consider applying for RAP as soon as possible. To apply, borrowers should contact the National Student Loans Service Centre or visit CanLearn.ca for more information.

CanLearn.ca offers a wealth of information on saving, planning and paying for post-secondary education, as well as online tools such as the Repayment Assistance Estimator, to help borrowers keep their finances on track.

 WoodGreen Community Services teaches money management to women

Toronto-based WoodGreen Community Services works to enhance self-sufficiency, promote well-being and reduce poverty through innovative program and services. Among its many initiatives is a "Money Management" course, offered as part of the Boundless Possibilities for Women Program, a 16-week job-training and college-preparation course for women, many of whom have experienced violence. The Program, and its Money Management course, have made a real difference in the lives of many women and one of them agreed to share her experience for this article.

Leila Abbas (fictitious name) arrived in Canada in 2003 with her husband and three children to begin a new life. But Leila's husband became increasingly abusive, and she was forced to flee to a shelter with her children. She had to begin rebuilding her life as a single parent, and found herself in charge of the family finances - something that was completely new to her.

For years, Leila had been forbidden to handle any household money - not even to buy food and clothing for her kids. Now, Leila was overwhelmed at the prospect of managing her finances alone. She turned to WoodGreen Community Services and found the critical social services she needed. Among others, she enrolled in the Money Management course where she learned about everything from credit reports to tax returns, and also began to understand how to address her student loan debt.

Leila was very afraid to speak up in public. She recalls, "so many times in class, everybody was talking but my mouth wouldn't let me speak. I remember when Elaine [the teacher] talked about loans and I had so many questions I wanted to ask, but my mouth wouldn't." As the course progressed, Leila gained financial knowledge and also increased her self-confidence. She was particularly nervous about dealing with debt collectors, but after learning about the collections system she gained perspective. "Before, I had a fear of my creditors, now I can tell them my situation and I'm not so afraid," she says. Leila says she is deeply grateful to WoodGreen Community Services for offering this class, noting how much she learned and how it helps her be optimistic about the future.

"I learned that I can have RESPs for my kids even when I'm on social assistance. I also learned about TFSAs. I want to manage my debt, I want to get my place, settle down, and then I'll need to make a budget, and WoodGreen taught us how in the Money Management class."

For more information about WoodGreen Community Services and its various programs, visit www.woodgreen.org.

Protect Yourself! New financial literacy tools designed to help older adults protect themselves against financial abuse

In British Columbia at least 1 in 12 seniors experience abuse. Financial abuse is the most commonly reported. As the Task Force on Financial Literacy recognized in its report, the rapid aging of Canada's population makes financial abuse of older adults a growing problem.

In 2008, the BC Centre for Elder Advocacy and Support (BC CEAS) received funding from the Human Resources Skills Development Canada, New Horizons for Seniors Program, to create a series of financial abuse resources targeting older adult consumers. To help with this project, the BC CEAS contracted the Canadian Centre for Elder Law (CCEL) which produced the following materials:

Protect Yourself! is a self-contained train-the-trainer binder that allows agencies to train their own volunteers to deliver educational workshops, following a peer education model. The binder includes the material for two workshops, as well as resources for teaching volunteers. Workshop 1 is focused on powers of attorney and joint accounts. Workshop 2 discusses frauds and scams.

Financial Literacy 102 - A knowledge based approach to preventing financial abuse of older adults: a guide for professionals is a resource manual that provides an introduction to financial abuse of older adults, and a general overview of topics connected to financial literacy and financial planning for older adults. Directed at organizations that work with older adult consumers, the manual covers mental capacity, and substitute decision-making, and includes a list of resource agencies and tips for best practices.

The CCEL and BC CEAS also co-produced a series of educational videos on powers of attorney, elder abuse and frauds and scams. For more information, visit: www.bcli.org/ccel.

Credit Unions champion financial literacy

Promoting financial literacy is what credit unions do. Cooperatives and credit unions were founded on seven co-operative principles and among them the fifth principle: "education, training and information," is the impetus for strong financial literacy programs.

Today, there are more than seventy-five financial literacy programs offered by credit unions across Canada. A thorough scan of credit union financial literacy programs is available on the website of Credit Union Central of Canada at: http://cusr.cucentral.com. Some examples include:

• In British Columbia, North Shore Credit Union uses its Wishbank program to encourage its youngest members to develop good money habits by using a new style of piggy bank. Arranged in three compartments, the Wishbank teaches children to save, spend and share. A host of games, books, teaching aids and other materials round out the program for a wide range of age groups.
• In Nova Scotia and Newfoundland, credit unions support the High School Financial Planning Program/NEFE Financial Literacy Program, which provides financial literacy manuals for high school students.
• In Saskatchewan, Affinity Credit Union provides pre-loaded debit cards to all First Nations Band members. The Band loads the cards with funds that they would otherwise distribute by cheque. These cards eliminate band member's reliance on cheque-cashing facilities, while providing the consumer with advantages of safety and security, immediate liquidity, convenience, transparency and predictability of fees, all of which contribute to greater financial literacy.

For more information about Credit Union Central of Canada, visit: www.cucentral.com.

Date Modified:

2011-06-10