For many Canadians, financial issues are a lot like the Olympics: they think about them only occasionally, and frequently find themselves baffled when they do. In a world of declining financial security, that’s an unconscionable government failure.
Your average Canadian on the street may know as much about registered products as they do about the biathlon or slopestyle snowboarding; although there’s a tiny minority that care passionately, most people have only a vague sense of what it’s all about. That must change.
While sports contests come and go, the decisions people make, or don’t make, with their personal finances can affect their lives – and the lives of their children and grandchildren – in lasting and profound ways. Tax and estate planning must be given more thought than Canada’s medal chances in the bobsled event. For now, though, that’s not really the case.
The Olympic Games capture their share of the public mind through relentless media hype. Financial issues are never going to be as sexy or attention-grabbing. And, while our industry certainly does its part, it can’t be relied upon to educate Canadians independently. That’s a job for government – yet, its efforts in this critical area are sadly lacking.
Federal Finance Minister Jim Flaherty created a Task Force on Financial Literacy in 2009 with a mandate to create a national strategy for improving financial literacy. Five years later, it’s hard to say that much of anything has been achieved.
At last check, the government was working to launch a selection process to appoint a financial literacy leader to implement that national strategy. But, even if that leader is appointed tomorrow, it will take years – decades even – to have the sort of the impact that’s necessary.
With the latest data showing declining use of RRSPs coupled with reduced workplace pension coverage, these issues are growing more critical. If the government would commit to overhauling the retirement saving system, the failure to “own the podium” on financial literacy could be forgiven. As the government seemingly doesn’t intend to do so, the least it can do is give people the tools to make sound financial decisions.
© 2014 Investment Executive. All rights reserved.
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