Category: **Digital Resources

Financial Literacy: Strategies to meet the needs of low-income Albertans. Report from Social and Enterprise Development Innovations, June 2009.
Everyone is talking about money these days. Or rather, everyone is talking about lack of money; the last eighteen months have proven difficult for most Canadians. While financial literacy is not a new idea, it has received attention as the general public realizes they might not be making the best financial decisions. We are not as financially literate as we could be.

Social and Enterprise Development Innovations (SEDI) is a Canadian non-profit organization dedicated to helping low-income Canadians achieve economic self-sufficiency. Their work spans areas including financial literacy, asset building, and entrepreneurship. Briefly defined, SEDI is working from the premise that the goals of financial literacy are to increase financial knowledge and change financial behaviour. The Alberta Ministry of Employment and Immigration asked SEDI to look at financial literacy in Alberta, more specifically how it is effective and could improve the lives of low-income Albertans.

This project resulted in Financial Literacy: Strategies to Meet the Needs of Low-Income Albertans, a report that surveys best practices in financial literacy programs and policies around the globe and within Alberta. It contains feedback from program participants on how policies and strategies can be most effective.

Around the world
Internationally, New Zealand has taken the lead in successful financial literacy programs and policies. They are one of a small number of countries that has conducted a national financial literacy survey (Statistics Canada is currently working on a similar project); this survey indicated which demographics have lower levels of financial literacy. The data collected has been used to create a national strategy, which focuses on inclusion of financial education in school curriculum, provision of adequate information for any citizen faced with financial decision, and promotion of financial literacy programs in the workplace. The strategy focuses on teaching financial literacy at every age, with the recognition that financial habits develop early in life.

Hallmarks of a good national strategy
Programs in the UK, USA and Australia are also examined. Successful approaches to financial literacy in all these countries have several characteristics:

• Attitudes that financial literacy is a basic skill needed over the course of one’s life
• A national survey to create a baseline measure, with follow-up surveys every few years
• Multi-sectoral strategies, in the form of partnerships with many types of organizations to reach all audiences
• Ongoing program evaluation
• Information and programs are provided free of charge In Canada

The Canadian government invested five million dollars in financial literacy over the course of 2007 and 2008, through the Financial Consumer Agency of Canada. Several other organizations, including the Canadian Foundation for Economic Education, SEDI, the Canadian Centre for Financial Literacy, and the Joint Forum of Financial Market Regulators, are also involved in financial literacy program and policy development. The only province to currently boast financial literacy components within school curriculum is British Columbia. Several programs have been developed to target low-income Canadians who aren’t in school in major cities such as Ottawa, Winnipeg, Toronto, and Vancouver, in conjunction with the YMCA, CIBC, and other local organizations.

In Alberta
Here in Alberta, organizations in municipalities across the province have set up financial literacy programs for their clients and other low-income earners in their communities. In Edmonton, the Candora Society’s Women’s Savings group focuses on strategies for saving money and connecting to community resources. The Edmonton Financial Literacy Society creates financial literacy curriculum tailored to several specific target audiences, such as aboriginals or immigrants. In Calgary, Momentum has programs to help low-income earners better manage their resources to achieve financial self-sufficiency.

Current concerns
As a result of recent economic events, approaches to financial literacy have become more reactive rather than proactive. It is important that policy developers keep in mind the need for proactive strategies even as they deal with current crises. Recent events have also proven that, while financial literacy education is crucial, regulation and public policy to protect consumers must also be in place.

This report contains solid grounding on the ingredients of sound financial literacy policy, and feedback from program participants will provide the Alberta Ministry of Employment and Immigration with insight into the barriers program developers and participants may face.
Read this report if you are involved in financial literacy program or policy development and delivery; if you are working to improve the lives of low-income Albertans; if you are interested in financial education.

Visit our library catalogue to find this publication in our library or online. For more information on SEDI’s own perspective on financial literacy, visit their website at www[dot]sedi[dot]org, or check out some of the following publications (available online or through the ESPC library):

Financial Inclusion for Homeless Persons and Those at Risk. SEDI, 2008.
Delivery Models for Financial Literacy Interventions: A Case Study Approach. SEDI, 2008.
Financial Capability: Learning from Canadian Communities. SEDI, 2006.
Review by Jennifer Hoyer
 

ESPC Documents/PUBLICATIONS/A.06.C RESEARCH UPDATES/2009 November Research Update.pdf

Book published by the OECD, 2009. Available in the ESPC library as book or PDF.

Childcare workers and policymakers interested in child welfare should take a look at Doing Better for Children. This in-depth report examines the efforts OECD member countries are making to enhance the well-being of their children. The authors ask what government programs for children are achieving and investigate whether money is being spent wisely. Why should we care about these issues? Because the health of our economy and society hinges on the well-being of today’s children.
The scope of this book includes data on how 28 member countries, including Canada, distribute government social spending across the life cycle of a child. It is very helpful to look at Canada’s data in this context. The report also lets us look at how we measure up against our peer countries in relation to the proportion of resources they allocate to child well-being.

Doing Better for Children compares data across six areas:

• Material Well-being
• Housing and Environment
• Education
• Health and Safety
• Risk Behaviours
• Quality of School Life

Other important issues are also discussed. It turns out that more money is spent on the last third of childhood – the “facebook years” – than the first third – the “Dora the Explorer years”. By contrast, the authors conclude that spending on the first third of childhood is more effective. Following from this, policies regarding services for infants and very young children (under-3s) are compared across countries.

Another interesting theme is intergenerational inequality. Do children become their parents? Is social mobility an option for children today? It turns out that socioeconomic class plays a major role in determining social mobility.

Controversial conclusions are made with regards to family environment. The authors discuss whether family make-up has an impact on child well-being, and they state that staying together for the kids doesn’t necessarily create a better home environment than a single-parent family.

The authors report some difficulty collecting data due to a general lack of statistic-keeping for this age group. Despite this, they have compiled insightful data into easy-to-read tables and graphs.

Several general policy recommendations are made. They include the following:

• Governments should invest more in early childhood than in later adolescence
• Early investment in disadvantaged children needs follow-up throughout their childhood
• Intergenerational inequality will most likely be broken by early investment
• Policies for child well-being need to address all the dimensions of their lives
• Politicians and policymakers need targets and timelines if goals related to child well-being are to be met.
• Comprehensive statistics on children need to be gathered regularly, both to monitor child well-being and to inform policy. At present, children are “statistically invisible” in many countries.
• Governments must be vigilant in tracking the effectiveness of programs and ensuring that funding is properly allocated.

A few specific and thought-provoking policy suggestions are made: Parental smoking should be reduced, especially during pregnancy. Educational funding should be reallocated towards disadvantaged children. Less money should be spent on post-natal hospital stays, older children, and single parents. Whether you agree with these statements or not, the report is worth a read.
There’s nothing like some OECD policy recommendations for good conversation starter!

Review by Jennifer Hoyer