Wednesday, June 22, 2011

Hard Knocks and Spare Change: Arlene Dickinson on Financial Literacy

Part 2 of my interview with Arlene Dickinson, Dragons' Den Star

Watch Arlene on Dragons' Den
Wednesdays at 8pm on CBC
When you watch her on Dragons' Den, you make all kinds of assumptions. She must have come from a rich family. She must have grown up surrounded by entrepreneurs. She must have an MBA. Indeed she is a smart, powerful woman with a talent for communication, building connections and negotiating a good deal, but the truth is Arlene's roots are far more humble. Maybe that is one of the secrets of her success.

Hard Knocks Graduate
Arlene grew up in a relatively poor home. She never felt entitled to money and understood that if she wanted it she would have to earn it. She learned about money "through the school of hard knocks." There was no one to turn to when things were tight because no one in the family had any money. There were times when she had money and times when she didn't. She had to figure out how to manage it through the ups and downs on her own. And she did.

I was surprised to learn that Arlene didn't get to go to university. She's entirely self-taught. And if that's not impressive enough, she did a lot of this self-educating while raising four kids as a single mom. That led me to ask her what she does when she's in a business meeting and a money-word comes up that she might not know. Arlene's strategy is very practical: if it's appropriate she will interject with a question; if it's not a good time to interject she will make a note of it on her Blackberry and research the word later.

Spare Change Matters
Arlene seemed to enjoy telling me about a financial education ritual that she started with her nine-year-old grandson a few years ago. When he comes to visit she lets him go through her purse and collect all the spare change that is rolling around at the bottom. As he's happily rooting around, Arlene examines the change and tries to recall the purchases associated with it and then tells those stories to her grandson.

Once he has found every last penny they put the money in a decorate vase and keep it there. At the end of the year, Arlene and her grandson do a tally, roll it up and deposit it into his bank account. According to Arlene he is learning a lot about the value of money, especially about the power of small amounts adding up over time. "He is learning that spare change adds up to significant dollars," said Arlene, after admitting that last year her purse produced $700-worth of spare change.

Aside from helping him get a head start on the habit of saving, Arlene explained that this ritual has created a context in which she can talk to her grandson, and the rest of the family, about how money needs to be treated with respect. Over the years she has encouraged her now-adult children to start an RRSP early and put money in it regularly, even small amounts, so that it can compound over time. In fact, when I asked Arlene what money-word she wishes every Canadian understood, she said "interest."

The Bigger Picture
Our conversation then turned to financial literacy education and business culture in Canada. I asked her who she thinks is ultimately responsible for making sure that every high-school graduate is financially literate: families or schools? Even though she wanted to say "both" I made her choose one and she picked "families." Arlene said, "Economies are driven by individuals not governments. Financial literacy needs to start with understanding how to take care of yourself."

Arlene on the Cover of Alberta Venture's
Women and Power Issue in 2009
Given that Arlene is the only female Dragon, I had to ask her about gender in business. Does it still matter? Arlene's answer was insightful and challenging.

She believes that men and women have different approaches in business. We notice this more now, she said, because more women are running small businesses and looking after themselves financially. She thinks we need to accept that there is a gender difference that will always be there and she takes issue with the bad rap that emotion gets in the business world.

Arlene told me that emotion matters because without it you cannot create passion for your product or service. "Emotions belong in business because we collaborate better with others when we are emotionally connected," she said.

Speaking of passion and connection, before I hung up the phone, I told Arlene about the Federal Government's mandate to appoint a national leader in financial literacy and asked her if she might apply. Her answer was, "That's a role that I would love to do because I think the whole idea of finances and how we think about money needs to be simplified."

She went on to say that we need to stop perpetuating the myth that you need to be a highly educated and highly informed individual to be able to manage your own money. "That's not true," she said. "You don't have to hand your money over to someone else to be successful."

Wow. Great answer and a potent reminder that to be successful in life and in finances you don't have to come from a rich family.

Here is part one of my interview with Arlene: "Ordinary People, Fundraising and the Art of Persuasion."

Copyright 2011. Laura Thomas. All Rights Reserved.
For reprint permission contact moneyme at telus dot net.

Monday, June 20, 2011

Ordinary People, Fundraising and the Art of Persuasion

Part 1 of my interview with Arlene Dickinson, Dragons' Den Star

Arlene Dickinson has a new book coming
out this fall called Persuasion
When I sat down this morning to blog my interview with this amazing mom, grandmother, TV-star, inspirational speaker, and self-made CEO, I thought it would be easy. I would just dive into our financial literacy discussion and have it written in about an hour. Wrong. We only spoke for about twenty minutes but Arlene shared so much wisdom that I simply can't cover it all in one blog post or you'd be reading this for a week.

So I decided to begin at the end of the interview, the part where Arlene shared some of the details about her new book that is coming out this fall with Harper Collins called Persuasion. Why? Because the subject connects with the recent passing of fundraising-icon Betty Fox and with some cancer fundraisers that have been going on in my community this past weekend.

On Saturday, I participated in a Jail N'Bail fundraiser to raise money to support a local Cops for Cancer cycle tour. That same day, a group of 90 ordinary people cycled 400 km from Kelowna to Delta, B.C. in 19 hours for Ride2Survive, raising over a quarter of a million dollars for cancer research. From my Jail N'Bail "cell" by the liquor store at the mall I began to wonder just what it takes to convince people to open up their wallets and give away their hard-earned cash for a cause.

Interestingly, most of the persuading that I have been seeing lately is being done by ordinary people, not by marketers or professional fundraisers. How do they do it? That got me thinking about Arlene's new book.

Genuine - Authentic - Reciprocal
Often associated with stealthy marketing strategies that suck us into buying stuff we don't need, the word persuasion gets a bad rap. Arlene hopes to change that with her book. Her definition of persuasion has three aspects: being genuine; being authentic or honest about who you are and what your motive is; and reciprocity or having a win-win attitude. For Arlene, persuasion not about getting what you want from someone else at all costs, it's about connecting in way that benefits everyone involved. This is something that Arlene thinks most of us ordinary folk (I mean non-business types) already know. I think she's right.

Jail N'Bail for Cops for Cancer
When Arlene first tweeted about her book a few weeks ago, I assumed that it was aimed at professional marketers and salespeople. But it's not. It's for everyone. As Arlene said, "The audience is an individual who is trying to ensure that their voice is being heard and who wants their opinion to be championed." According to Arlene, that includes anyone who is trying to convince anyone else to do something they might not want to do. That could be getting a child to go to bed or asking a complete stranger to donate money to spring you out of jail for cancer research.

Not only did Arlene talk about the idea that we are all involved in the art of persuasion on a daily basis, she also brought up this interesting point: life and business are interconnected. "We need to take our life lessons into business and vice versa," she said. "If you can manage a household budget, you can manage a business budget. If you can persuade your kids to do things they don't want to do then you can persuade your work-mates to champion your idea." can convince friends, family and strangers to donate cash for cancer research.

I suppose that is what is behind all this money (and it's BIG money) being raised for cancer research by people who don't have degrees in marketing and sales but who do seem to have an instinctive understanding of Arlene's definition of persuasion. I suppose on some level many of us know that the secret of successful fundraising is to be yourself, be honest and aim for a win-win situation. For those of us ordinary people who may be unaware that our life-skills toolkit is already loaded with persuasion tools, Arlene's book will help us sharpen those tools so that we can raise even more money for the causes we believe in.

On the Radio & Blogging for the Sun
Part 2 of my interview with Arlene will be published in the coming week. In the meantime, please tune in tomorrow, June 21, 2011, to Fiscal Literacy Radio to hear me talk about kids and money at 1 pm EST. And note that I will be blogging daily for the Vancouver Sun "Your Money" section for two weeks starting June 27 so be sure to follow along there too. And, if this article has put you in a giving mood, Cops for Cancer Tour de Valley is still taking donations. Ride2Survive 2011 is still taking donations and registration is now open for the 2012 ride.

Copyright 2011. Laura Thomas. All Rights Reserved.
For reprint permission contact moneyme at telus dot net.

Thursday, June 16, 2011

Financial Illiteracy Contributed to Stanley Cup Riot

Would a small business owner smash a store window? Would a self-employed person flip over a car? Would an entrepreneur set a garbage can on fire? Not likely and it may come down to financial education and the lack of it in BC schools. 

It's About Money, Not Hockey
What do entrepreneurial types have in common? They understand money. They know how difficult it is to raise it, save it and grow it. They respect it. They get it. Entrepreneurs tend to understand that an NHL team is a business and the aim of every successful business is to make money. Hockey is secondary to profit. This isn't amateur sports.

Entrepreneurial-types understand that it doesn't really matter who won last night. The teams put on a good show, made lots of money and, riot aside, everybody won. The rioters, apparently, didn't grasp this fact. For this group of young adults, who appear from media images to be primarily in their twenties, it's all about "my team has to win" and so losing is personal. The business aspect, the fact that money is at the heart of professional sports, didn't seem to be part of the individual rioter's thought process. Those who rioted clearly don't understand money nor do they have any respect for it.

Which may be why smashing windows, flipping cars and setting public and private property on fire was an appropriate response for them. There is no consideration of the expense, no cost-benefit analysis, no awareness that everyone who participates in the Vancouver economy will be paying for this outburst in both the short and long term. And why is the average twenty-something Stanley Cup rioter so unaware when it comes to money? It could very well be the lack of financial education in BC schools.

Not Enough Financial Education
Since, 2008 every student in BC has had to take a "life skills" course called Planning 10. In that course there is a four week, twenty-hour unit on personal finances. There are four prescribed learning outcomes for this unit: budgeting, planning for life after graduation, understanding credit and debt and how to report personal income. It has been argued that this is better than nothing. But is twenty hours of instruction enough to make students financially literate, especially when most of those students arrive in Planning 10 with little or no familiarity with the vocabulary and concepts of personal finance? Not likely.

Only a small portion of high school students in BC take business courses. That means most graduates don't get more financial education that what they receive in Planning 10. You cannot create a money-savvy citizenry with twenty hours of instruction over thirteen years, which is why the Ministry of Education in Ontario, starting this fall, is making personal finance education a mandatory part of the curriculum in grades four through twelve.

Imagine those Ontario students who are starting grade four this year. Every year for the next nine years they are going to be learning the language of money. They are going to be introduced to the realities of earning, spending and saving. Core concepts are going to be repeated and reinforced, deepening their understanding of how their personal financial choices shape the world we live in.

In Toronto in 2020, there will probably be a record number of high-school graduates who go on to start small businesses or choose to be self-employed. The city's economy will benefit from this upswing in entrepreneurial spirit, self-driven productivity and healthy respect for money. And if, by chance, the Leafs happen to lose game seven of the Stanley Cup finals in 2025, you can bet that with its financially aware and economically responsible citizenry that there won't likely be any window smashing, car flipping or random burning in downtown Toronto. 

Financial literacy is a powerful force. So is financial illiteracy, as we saw in Vancouver last night.

Copyright 2011. Laura Thomas. All Rights Reserved.
For reprint permission contact moneyme at telus dot net.

Monday, June 13, 2011

A Word on Financial Literacy from the Dragons' Den

Alex Kenjeev
President of O'Leary Ventures
What could be more rewarding for a Dragons' Den fan than talking to a Dragon? How about talking to one of the Dragons' business associates like Alex Kenjeev, President of O'Leary Ventures, a private company owned by Kevin O'Leary? Speaking to me from the set of season six, Alex and I had a a lively conversation which began with a discussion about the connection between the financial literacy level of the average Canadian and the country's economic wellbeing.

Alex shares my view that individual financial literacy is critically important to the economy and agrees that poor financial literacy skills contributed in part to the US mortgage crisis. He talked about how too many Americans got themselves into mortgages that they could never pay off and then suggested that a country would be better off if everyone followed this O'Leary rule of thumb: save one-third of every pay cheque and put it to work for you earning interest or in investments.

Alex explained that Kevin frequently reminds people who aim to build wealth to focus on the big picture when it comes to personal finances, which often means avoiding spending hard-earned money on consumption expenses such as daily cups of specialty coffee. "One of Kevin's mantras is to invest first and then spend only the interest, never the principal," said Alex. "When you have enough interest for your daily latte, then go for it, but not before that."

Disparity in Financial Literacy
When I asked him what letter grade he would give Canadians for financial literacy, Alex pointed out that the more important issue is the disparity between those who are financially literate and those who are not. Alex gave the example of two people with identical jobs and salaries but who have vastly different financial literacy skills. The person with the higher level would do better financially in his or her lifetime, while the other would be more at risk of financial ruin. "This disparity would be amplified over time," said Alex.

When I asked him about the financial literacy level of the average would-be entrepreneur pitching a business plan, his answer was similar: there is a huge disparity between pitchers when it comes to financial literacy. He said that successful pitchers always have someone along who can talk money and articulate how investors can make money by investing in the business. As a fan of Dragons' Den, I've certainly noticed that pitchers who fumble for the right money word or who don't know their numbers rarely get deals, especially from Kevin.

As we talked a bit more about how the show has helped improve the financial literacy level of it's viewers, Alex made this insightful comment: "There is no real reason why more Canadians can't be wealthy."

He's right. There's no cap on the number of rich people there can be in this country. Dragons' Den keeps that fact in our faces. Every time we watch an episode, my daughter and I are reminded that it is possible to go out into the world and be an entrepreneur and make more money, with the caveat that in order to have a decent shot you need to be financially literate. That is a powerful lesson.

Speaking of powerful lessons, we wrapped up the conversation talking about Alex's (and Kevin's) philosophy of money. Of course, I had to ask him my O'Leary question: What three things should we teach five-year-olds about money? By his own admission, Alex's answer could have come directly from Kevin's mouth:
  1. Be honest about money.
  2. Pay attention to money.
  3. Don't confuse money with feelings.
It's About Freedom
Before I let him go, I asked Alex how he would explain the term "venture capital" to someone who might not be familiar with it. He explained that venture capital is like a "dating service for money." It brings together a business that is looking to grow to the next level with an individual who has cash to invest. Hopefully, it's a good relationship that turns into a serious romance.

I can just imagine that in O'Leary terms a "good" relationship means that everyone is making money or there's going to be a nasty break up. After all, according to Alex's boss, "nothing matters more than money." And, when I asked Alex what he thinks about Kevin's statement he said, "Money is about freedom. It lets you do what is important to you. Just look at Kevin. He can do what he wants, when he wants, however he wants to do it."

Alex's comment made me realize that as a wealthy nation, we truly have the freedom to choose whether or not we want to spend our tax dollars on financial literacy education and getting personal finance basics into our schools. I believe there is money at the provincial and federal levels than can be spent narrowing the disparity between those Canadians who would get an A+ in financial literacy and those would would get an F. Just imagine a country in which every high school graduate was financially literate. It could happen here in Canada. As I wrote in an article for the Vancouver Sun last week, the Ontario Ministry of Education is leading the way.

As Alex said, money gives you the freedom to do what is important to you. Do we understand that more of us could be wealthy if more of us were financially literate? Do we get that individual financial literacy is worth investing because it will build our economy? Is raising money-wise kids important to Canadians in every province and territory? I hope so.

Stay tuned for more words from the Den on financial literacy...I will be talking to Dragon Arlene Dickinson later this week.

Copyright 2011. Laura Thomas. All Rights Reserved.
For reprint permission contact moneyme at

Tuesday, June 7, 2011

What's stopping you from talking to your kids about money?

You don't know where to start.
Sure you do. While watching the NHL playoff game last night my daughter and I talked about how the Vancouver Canuck's horrific loss translates into huge financial gains for the owners, players and collateral businesses. This morning on our way to school, we talked about our summer budget. There is an opportunity for my daughter to go to a horseback riding camp but I explained that the $150 required to pay for it would have to come out of our Europe vacation budget. She got it. We can't afford both.

You are embarrassed because your finances are mess.
Chances are that if your finances are a mess, your kids already know it. They eavesdrop on our conversations and see the lines of worry on our faces. They know when we are stuck in our heads and floundering in a sea of negative thoughts. They know because they see that while we are in the room with them, we really aren't all there at all. Is hiding the mess really better than talking about it and modeling recovery? I don't think so.

You think that money is the root of all evil.
Think about your tongue. Do you use it to encourage and build up those around you? Or do you natter, criticize and tear down? Your tongue isn't inherently evil, neither is money. What matters is how you use it.

You assume they are learning about money in school.
Don't assume. Ontario is the only province in Canada that has made financial education a mandatory part of the curriculum. That's just getting underway in September and will include grades 4 to 12. So if you're in Ontario you can breathe a bit easier. As for the rest of us, we have to do the teaching at home if we want our kids to be financially literate.

You think that kids should figure it out for themselves, like you did.
I had to figure out the basics of personal finance on my own, but that's not how I want to parent. So about a year ago, I decided to begin debt-proofing my daughter by making her aware of the decision-making and self-control aspects of finance. I hope this awareness will help prevent her from developing habits that could lead to financial self-harm down the road. It seems to be paying off. After our conversation this morning about our summer vacation budget, she turned to me and said that maybe we shouldn't spend the $150 at all. "We could save it, Mom," she said.

Copyright 2011. Laura Thomas. All Rights Reserved.
For reprint permission contact

Thursday, June 2, 2011

International Financial Literacy Conference Big 5 Themes

Ursula Menke's Welcome Address
Last week at the Westin Harbour Castle in Toronto, 400 delegates from around the world came together to talk about financial literacy on a big scale. I was fortunate to be able to scoop a media pass for this major event which was cosponsored by the Organization for Economic Co-operation and Development (OECD) and the Financial Consumer Agency of Canada (FCAC).

Over the two days I attended every keynote, plenary and workshop that I possibly could.I interviewed celebrities such as personal finance author Alison Griffiths (who hosted the conference) and neuroscience author Jonah Lehrer. I chatted with power brokers such as Ursula Menke, Commissioner of the FCAC, and key analysts from the OECD. I came home with a book full of notes, several hours of recordings and 16.8 pounds of literature.

I have a lot of writing to do in the coming weeks. In the meantime, here's a quick look at the top five themes that stuck out for me during this two-day international financial education event.

The Movement is Gaining Ground
Did you know that financial literacy was on the agenda at the 2006 G8 meeting? Or that Canada is a global leader in financial literacy? While there are still many countries which do not have financial literacy on their radars, there is no doubt that the international movement to educate and equip citizens around the world to make better financial decisions is gaining ground. Thanks to the work of a variety of stakeholders such as the OECD, policy makers in several countries have accepted the idea that a money-savvy citizenry is good for global and local economies.

This is great because it means that we can move from spending money on convincing politicians to act toward figuring out how to spend money on financial education. The question these days is not so much why but how.

Tests and Measurements
One of the main themes of the conference was evaluation. How do we know which financial education programs and projects are worthwhile? Presentations and workshops on this topic delved into identifying vulnerable populations, what money topics to teach and establishing best practices for implementation and evaluation.

There were also discussions about educational resources and how those should be evaluated. There was a plenary that looked at the importance of evaluating the many financial literacy projects that are springing up around the world. Are they cost-effective and efficient? The OECD along with policy analysts from around the globe are working on the evaluation issue, especially as it relates to bringing financial education to the school curriculum.

Coming to a School Near You
I am beginning to believe that ten years from now personal finance education will be part of the primary and secondary school curriculum. In Canada, this is already underway. Starting this fall, Ontario teachers of grades four through twelve will be teaching personal finance in their classrooms. We are still a long way from a national movement in this direction, but at the conference I heard "off the record" that all of Canada's education ministers are on board.

Globally, Australia seems to be way ahead on this. They have had financial education in the schools for several years. Their advice to advocates from countries where the ministers of education are less open to the idea is to frame financial education as a "value add" to the existing curriculum and give up on the dream of making it a stand-alone subject. The other secret they say is to provide classroom ready resources so that teachers feel confident delivering the material.

Nudge or Educate Debate
Several plenaries and workshops dovetailed on the debate as to whether or not consumers should be educated or nudged towards making a particular financial choice. Education is straightforward and includes teaching kids about money in schools or providing consumers with educational materials or workshops or private consultations that will help them make smarter decisions.

A nudge, I learned, is more controversial. For example, should governments automatically enroll employees in a state-run pension plan and leave it to the employee to do the opt-out paperwork? This is a hot topic. The education advocates say that this is not really ethical, while the nudgers argue that this is an effective way to encourage more citizens to save for retirement.

Another part of this debate is the relatively new field of behavioural economics, the study of consumer choice at the brain level. Apparently, our brains are not well designed to handle credit cards and other tools of the modern financial system. And with the increasing number of complicated products and smart technologies, our brains are going to need some retraining.

Technology is Upping the Stakes
I understand that very soon it will be possible to make a purchase with a wave of your smart phone. There will also be easy access, instantaneous offers of small credit amounts that will be sent through your phone. Mobile banking is growing, too, and there is a great deal of concern over how low-income and at-risk populations will be able to cope.

Panels of industry experts talked about how financial education initiatives should address the issue. One workshop looked at how social marketing and communication tools might be used to improve the effectiveness of these initiatives asking how can social media influence and improve the financial awareness of consumers? What a great question and we don't have the answer yet.

Like I said, I have a lot of material to sort through and a lot of writing to do in the coming weeks. If you have any questions or comments about the conference, or have a topic that you would like me to address in  a future article, please email me at

Copyright 2011. Laura Thomas. All Rights Reserved.
For reprint permission contact