Submitted. As kids across B.C. get set to head back to the halls of learning in September, their parents are striving to teach them a thing or two about money.
A First West Credit Union-commissioned survey on parents’ beliefs and behaviours toward the financial literacy of their children found that 80 per cent of parents in British Columbia believe they bear the responsibility for teaching their kids about money. And they appear to be putting their money where their mouth is—79 per cent of parents said their kids learn about money from them. Only 5 per cent of those surveyed indicated their children are not yet learning about money matters, likely because their children are not yet at an age when financial concepts stick.
“Overall this is welcome news, since financial literacy needs to start in the home,” says Michael Voros, father of three and branch manager with Envision Financial, a division of First West Credit Union. “At a time when average household debt is at a record high, many Canadians save very little, borrowing is cheap and the economy is lukewarm, there’s certainly a need to help younger generations learn how to manage their money wisely.”
Parents also appear willing to use their household financial situation as a real-world teaching tool. The survey found that parents have an attitude of openness and sharing—rather than reluctance or silence—when it comes to discussing finances with their children. When asked how much they discussed their household’s finances with their kids, more parents leaned toward transparency, with 71% indicating 3 or higher on a scale of 1 to 5 (where 1 indicated “not at all” and 5 indicated full transparency).
Still, young adults continue to demonstrate poor financial literacy despite parents’ proactivity in financial education. Take for instance a recent report by the Filene Research Institute, using data from the National Financial Capability Study in the United States. It noted that 68% of millennials have a low level of financial literacy, even though nearly 70% believe they have a high level of financial knowledge. Closer to home, the Financial Consumer Agency of Canada has been working over the past several years to improve financial literacy across the country. Its most recent financial capability study found that too few Canadians are engaged in fundamental financial practices like budgeting and saving for retirement.
Voros says findings like these suggest that financial home-schooling isn’t as good as it should be.
“Our survey found that one in four parents were exclusively self-taught on money matters and more than half of parents—58 per cent—got their financial education from one source, whether that was parents, grandparents or other sources. That means parents’ financial knowledge and understanding may lack depth, so there’s a risk kids, in turn, are getting a shallow financial education. As in many things in life, it makes good sense to learn from a variety of sources and teachers.”
Voros says that’s where professionals can step in to help parents build more in-depth financial knowledge.
“The more we can help parents manage the complexity of today’s financial landscape, the better we can financially prepare future generations,” he says. “The survey results show there’s a clear role for professionals when it comes to financial literacy. That’s why we have such a strong focus on building banking knowledge.”
Other findings from the survey
- Among those who believe parents have the primary responsibility to teach their children about money, only 56 per cent believe there are sufficient resources available to teach children about money. Among all respondents this number drops to 53 per cent.
- 53 per cent of respondents said they learned about money from their parents or grandparents.
- While the majority of parents are teaching their kids about money, only about half of those surveyed were taught by their moms and dads.
Survey methodology
First West Credit Union conducted a poll of 507 people in British Columbia from Jun 2 to 7, 2016, using Google Consumer Surveys. Google Consumer Surveys is an online tool that collects feedback from the general population, targeting visitors to desktop and mobile websites. The results of this survey are accurate at the 95 per cent confidence level +/- 4.3 per cent and statistically weighted according to age and gender to ensure a representative sample.
About Envision Financial
Envision Financial is a premier provider of banking, investment and insurance services for residents and businesses throughout the Fraser Valley, Lower Mainland and Kitimat regions. As a division of First West Credit Union, B.C.’s third-largest credit union with 54 branches and 38 insurance offices throughout the province, Envision Financial brings innovative products, an extensive branch network and local decision making to the banking experience. Visit envisionfinancial.ca for more information.
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