Ontario has recently introduced a revamped financial literacy program into its high school curriculum. Well sort of. It has pre-existed as an elective in some schools for a while. What was needed was a complete overall and refocus. It is a corner block of incorporating living skills into the educational process. Why you ask? Shouldn’t this be done at home. The surprising answer is that a lot of people don’t know what it is and what it should provide.
Perhaps the resource for financial literacy is not available in the home because there are many adults who have never been taught good financial sense. It may speak to the high indebtedness levels in Canada. When it comes to managing money, making good decisions doesn’t always come naturally—especially in a society where opportunities for instant gratification abound, and purchases can be made with the click of a mouse or the swipe of a credit card.
In fact, by the end of this year, it has been projected that the average Canadian consumer’s total non-mortgage debt will hit an all-time high of $23,500. When you couple Canadians’ tendency to carry debt with increased living costs, it’s clear to see that teaching students to become financially literate should be a priority. This is especially evident when we take into consideration that personal finances are closely linked to overall health and well-being.
What does money have to do with health
While it may be true that money can’t buy you happiness or good health, knowing how to manage money can help people lead healthy, productive lives and steer clear of a number of high-risk behaviours related to stress and a lack of self-care.
We know that many factors contribute to healthy living. These include eating well; daily physical activity; managing stress; and avoiding cigarettes, drug use and the overconsumption of alcohol. However, equally important to our health are factors like having enough money to buy healthy food and other necessities; education, housing, supportive family and friends, and a safe community.
And while some things that affect our health cannot be changed (e.g. our genetic background), the social determinants of health arise from the interaction between a person and the society they live in and can be altered if, as a society, we are willing to take action. One key way we can work to create more equal access to the conditions that lead to better health is to teach financial literacy in Ontario schools.
Defining financial literacy
Financial literacy is defined as having the knowledge and skills needed to make responsible economic and financial decisions with competence and confidence. Regardless of backgrounds, individuals who have a solid understanding of financial basics are more likely to be able to navigate today’s complex financial world.
If you’re talking about primary students, financial literacy means understanding what money is—its purpose and value. We talk about understanding the difference between needs and wants and how, if we need something, we have to develop a plan to get it.
We also look at the world of advertising. What’s being sold, who is trying to sell it to them, how the commercial makes them feel… whether that’s a healthy thing or not. According to the Ontario Ministry of Education, these types of lessons should begin in grade four .
Moving into the secondary grades, lessons around finances evolve to include planning for future events such as looking for a job, saving for university or making major purchases like cars or electronics. We don’t just look at the present, but also how one decision in the present can impact the future.
This includes important discussions about credit cards and online banking and purchasing. The transition from secondary education to tertiary education is a challenging time for most students and it is most often the time in which students begin to establish their credit history. Learning how to use a credit card properly prior to this transition will equip students with the skills needed to make smart decisions in regards to credit card usage. If not, they will undoubtedly experience the anxiety, stresses and depression associated with being financially irresponsible.
Financial literacy is linked to the living skills
While there are obvious ties between financial literacy and subject areas like math, social studies and even the language curriculum, through explorations of the media, the topic is also closely linked to the living skills taught through the Health and Physical Education curriculum. The learning expectations in the H&PE curriculum are organized into Active Living, Movement Competence and Healthy Living. A further set of expectations is then linked to all three strands. These are the living skills. The personal, interpersonal, and critical and creative thinking skills that help students learn to set goals, solve problems and consider how their actions affect others.
Not only can educators link lessons on financial literacy to setting personal goals (like saving and budgeting), they can also discuss how people who make better financial decisions tend to have less stress, essentially decreasing risk of various health conditions. Teaching financial literacy also leads to more knowledgeable and compassionate citizens. For example, looking at things like where products come from, how they’re made and how that makes an impact on the other side of the world. Every time students use money they’re voting on the type of food they’ll have access to and on how the products are made.
When teaching financial literacy, look for resources that can help you reach all students. Almost 50% of Canadians struggle with financial tasks, which is alarming since it should be considered a foundation towards setting the stage for Canada’s ability to compete in the global economy. If you count yourself among the 50% who struggle with finances, the task of teaching students to become financially literate may feel daunting.
What’s more, even for an educator who feels confident managing money, teaching financial literacy can still have its challenges. Programs that teach financial education need to be sensitive to the diverse socio-economic and cultural backgrounds of students and should also involve differentiated instructional strategies to meet the learning needs of diverse students.
Financially-savvy students can build stronger families, stronger communities and a stronger Ontario. As adults, we sometimes falsely believe that it’s kinder to shield children from financial realities and the consequences of failing to budget properly. This is sometimes the attitude that is expressed in the home. However, these kinds of conversations and experiences are not only appropriate—they’re essential if we want to help students learn to manage their money, lead healthy lives and grow into responsible contributing members of society.
When you know how to make good financial decisions, it impacts your well-being in the short and long-term. In the short-term, students learn the benefits of planning, budgeting and saving. In the long-term, it empowers them to become citizens who have the resources they need to take care of their bodies, minds and relationships—something which, over time, will contribute to the strength of our society as a whole. We want to inspire young people to own their futures, to achieve financial independence and to be comfortable with financial literacy throughout their lives.
What’s the best way to achieve this goal? First, teachers must get comfortable with the fundamentals of finance themselves. Then they need to start having honest, fact-filled conversations about money with their students, teaching them how to prepare and plan for bright and healthy financial futures. This is the fundamental underpinning of the new financial literacy program in Ontario. It is about time we confirmed its importance in our curriculum. The revised approach is Keeping Life Current.