What is financial literacy?

What is financial literacy?

Financial literacy describes the knowledge and skills associated with managing the choices and activities you must carry out to have secure and reliable control of your financial well-being.

It isn’t about how much money you have, but whether the money you do have is working with you to achieve your goals based on your personal values and priorities.

Canada’s Task Force on Financial Literacy defines financial literacy as having the knowledge, skills and confidence to make responsible financial decisions.

  • Knowledge refers to an understanding of personal and broader financial matters
  • Skills refer to the ability to apply that financial knowledge in everyday life
  • Confidence means having the self-assurance to make important decisions, and
  • Responsible financial decisions refers to the ability of individuals to use the knowledge, skills and confidence they have gained to make choices appropriate to their own circumstances.

For more information, visit the Financial Consumer Agency of Canada website on financial literacy in Canada.

Are you financially literate?

If you know how to track your income and balance your expenses; if you can project your future needs and develop a savings plan to make sure you have money available when you need it; if you can understand your financial agreements and can manage your monetary obligations, you are already on the path to becoming financially literate.

In becoming financially literate you can feel more confident about your ability to face the future with peace of mind.

Visit the Tools and Resources section for information and resources on managing your financial needs.