Saturday, May 21, 2011

Who is Responsible for Financial Education in Canada?

Financial Literacy in Action
This week delegates representing governments and financial education stakeholders from around the globe will be spending two days in Toronto talking about financial literacy at a conference called Partnering to Turn Financial Literacy into Action. As I flip through the agenda for this by-invitation-only event, there is one workshop in particular that catches my eye. It's called "Financial Education in Schools: How do we bring financial education programs into the classroom?"

In this workshop the OECD (Organisation for Economic Co-operation and Development) will be presenting its Guidelines on Financial Education in Schools. The panelists will debate the pros and cons of different methods for integrating financial education into existing curricula around the world. They will also talk about the challenges of training teachers and discuss the development of teaching resources.

This workshop--coupled with some recent financial literacy presentations that I have made to primary school teachers and parent groups and some interviews with financial educators such as Gail Vaz-Oxlade--has got me thinking about who is ultimately responsible for making sure that every child is financially literate by high-school graduation.

Whose job is it?
Is it Mom and Dad's? Most parents I've talked to believe that personal finance should be taught in school. On the other hand, in a poll of 40 primary school teachers that I did a few weeks ago, half said that parents are ultimately responsible for their children's financial education. But what if mom and dad aren't financially literate? What then? Can teachers fit more curriculum into existing instructional hours? Should they?

Should it be our ministries of education? When I asked financial education self-help guru, Gail Vaz-Oxlade this question, she said that parents should be teaching this stuff to their children because "not everything should be taught in school." She used the example of how schools teach kids about the food pyramid and how that knowledge is meaningless and out of context for them because they (the kids) don't make the food choices at home. Mom and Dad do.

Money choices are the same, Vaz-Oxlade said. Teaching kids about money when they have none of their own is be pointless. Nonetheless, Manitoba and Ontario are introducing personal finance this fall, K-12 in Manitoba and grades 4-12 in Ontario.

Are we expecting our kids to be self-taught? Some of the most interesting and successful people that I have talked to about financial literacy are self-taught. Everything that I know about money I have taught myself. We never talked about money at home. I didn't learn anything about it in school. As a result I've made a lot of mistakes on my way to financial stability, but at least I've made it. Is this the best option? I don't think so, which is why I spend so much time talking to my daughter about money, and making sure that she has her own money to practice with. 

Should entrepreneurs step up and develop lucrative products that will do the job? There are a few small companies in Canada that are currently developing financial education products and services. (I know. I've been approached by a few). But the question remains, who should those products be aimed at? Can you make any money developing financial education products for schools? Or would it be better to create products that will help parents teach their kids about money? Which is the better investment?

Responsibility Leads to Action
This is a funny place that were are in right now. It reminds me of the whole sex-ed dilemma. Whose responsibility is it to teach kids about sex these days anyway? The family? The school? There is an uncanny parallel between sex and money in education. What is it about teaching kids the "facts of life" that sets parents' and educators' teeth on edge and makes them pass the buck back and forth?

It will be interesting to see where the discussions lead at the "Turn Financial Literacy into Action" conference next week. Seriously, if we don't agree on who is ultimately responsible, it will be impossible to point the finger at anyone and say, "Okay, Dude, open up your wallet and spend some money on financial education." Without responsibility, there is not likely to be any action and I'm not sure the global economy can afford that.

Copyright 2011. Laura Thomas. All Rights Reserved.
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  1. Great article Laura! As a health care professional, I sense a common denominator between a few points you raised citing the Canada Food Guide and sex ed in schools to underscore the rationale for early financial literacy education. Specifically, I am thinking of the proven concepts of prevention and harm-reduction. I certainly agree that children should learn financial literacy while they are young so they grow into the context of managing money with a foundation of knowledge already established. We teach children healthy eating and safe sex well before they are mature enough to engage in activities ranging from grocery shopping to adult relationships for the same reason. We don't wait until after someone's health is suffering from poor dietary choices to discuss nutrition or delay teaching family planning until after the age a person can first become pregnant. Teaching financial literacy should be everyone's responsibility because we all share in the same economy and we all need to take ownership for preventing the harms that can come from simple ignorance. Bravo for having the sensibility and skills to advance the issue of financial literacy for children.

  2. This is a great post.

    I think that the basics SHOULD be taught in school. I'm fairly certain that I have never used calculous outside of high school but, when I bought my first house, there was a lot of financial vocabulary that bankers, real estate agents and insurance folks assumed I would know and understand. It was a big learning curve. There would have been a lot less nail biting if SOME of the basics on the REALITY OF BEING A FINANCIALLY RESPONSIBLE ADULT in Canada had been covered somewhere along the line from K-12.

    Learning how we affect the global economy in our daily actions is crucial to give the next generation an equal footing. I look forward to hearing about the progress at the conference.

  3. Great post: Who is Responsible for Financial Education in Canada?

    We all are.

    Although I would like to point out that there are a number of dedicated business teachers ( I speak for those in BC) who are teaching these topics in school. Unfortunately for us, they are not mandatory courses, are taught in high school, are not always taken by enough students, and are often not promoted by enough teachers, administration, or parents.

    I am hoping that financial columnists, entrepreneurs, parents, teachers, etc will continue sharing their information, so that as a cog in the learning community we can work on making all of our youth financially literate. I believe that Gail Vaz-Oxade is incorrect in saying this should not be taught in schools, coming up to the "educational Financial Literacy plate" should be a requirement for all students, not an after thought of the education system.

    Martin Runge
    BCBEA President

  4. Wow, you guys are right-on! I teach Gr 8s, Applied Skills 8, and they are so keen! The course is a one-third year rotation, so they get cooking/sewing, and metal art too. I think of it as "sneaking" in the financial ed, feeling 007, wink of an eye, to have it included in there, "they little suspect how valuable it is!"

    I know that budgeting; importance of banking; personal investing; economics (P,Q,S,D,E); the business/economic cycle; and marketing including writing a "business plan," are topics that will come in handy when reading the net, a newspaper, a magazine, or following the news, tonight even.

    The idea that upstream-education will ward off regrets, "I wish someone had told me!" is what this has to be about--your "prevention and harm-reduction" comment, spot on! And you say they discussed this for 2 days in Toronto this month! Wow! I've always had this feeling "We are Not Alone!" and now it's feeling legitimate. Tired of detecting distain, "They pick that up, that's not really a course it is?" from family as well as comrades in arms, it's nice to sense a bit of support.

    PS WHO needs financial education products?? when educated educators have accounting, economics, finance under their belts?, and a foundation of guidance with IRPs, integrated resource packages, from the Ministry. Except, wait, my FAVOURITE district media services VHS videos need UPDATING (the ones on banking, credit, economics, perfect, but too old), SAME scripts please--The work is all done it seems to me. Students laugh, signs in the videos say, gas is $0.33, or "in the 90's there will be a need for," but asking backing-company to redo their banking videos for example, and they offered me a banker instead. A captivating update on the video(s) is "all" I need, it's what I prefer. (I'll give you the titles?), not another speaker, to say it all again, students were polite about it.

    Meantime, two days, eh? I am so excited! "They're trying to help us! We're saved!" and "They like us! they really, really like us!" Been here all along, right under your nose.

    Yes we need help. A little recognition, and an "input interview" with a systems-analyst sort-of-thing, to assess our needs and requirements, rather than a directive down-loaded onto us while we go about things the way we know best, with what little time we're given. Just offer the smorgasbord, your facts, the pieces, and we'll make them fit.

    The City package is very nice but I've got about 2.5 periods with the themes from that for the 8s. I use another video, to cover the "life stages & investment goals," and the KYC rule idea, similar to objectives within The City. [Thank goodness for our district media services! that ships the DVDs all around! I hope everyone can be so lucky?] With the ENT 10s The City felt contrived, probably cool for homeschoolers, though we cover the concepts just like before.