Recent IEF Research Highlights Need for Canadians to Get Back to Money Basics, Making Universal Money Truths More Important Than Ever
TORONTO, Sept. 5, 2012 /CNW/ - "Know Your Money Personality" tops the list of Canada's 8 Universal Truths about your money, presented by GetSmarterAboutMoney.ca, Canada's leading resource for financial literacy, financial education and research from the Investor Education Fund (IEF).
According to recent research conducted by IEF, seven in 10 Canadians agree that their personal financial situations affect their emotional and mental health. When asked about their biggest obstacles to money management and investing, respondents cited lack of money (48 per cent) and too much debt (27 per cent) as top barriers. Additionally, four in ten (44 per cent) don't save or invest for their retirement, other financial goals or big-ticket items they want to purchase; and 42 per cent of respondents with children say they do not save or invest for their children's education.
"This research tells us that Canadians are feeling overwhelmed by the demands on their finances, and as a result, they're not saving enough," says Tom Hamza, President of IEF. "It's human nature to feel like no amount of income is enough, but the reality is that we all have to make the best use of the money that we have."
To address this need, IEF developed the 8 Universal Truths about your money, guidelines that encompass the essentials of financial management that apply to all Canadians, regardless of age, gender, culture, income and profession. Over the next eight weeks, IEF will reveal one new Universal Money Truth per week on www.GetSmarterAboutMoney.ca, with new content that helps Canadians apply those truths in their everyday lives. In addition to social media activity, the content series will include videos featuring Canadians sharing their own personal money truths.
"Every Canadian's financial situation is different, but the basics of financial planning are the same - no matter who you are," says Hamza. "The Universal Money Truths are an effective way to learn the basics and make good money management a lifelong habit."
The 8 Universal Truths about your money are:
1. Know your money personality.
Everyone has a personality: unique attributes, values, goals, worries, tendencies, likes and dislikes that define their character. These traits also apply to your relationship with money - you have a "money personality." Knowing your money personality can help you meet your financial goals. For example, if you know that you are a spender, you could make saving a habit by setting up an automatic deposit to your savings account every payday.
2. Know what you're saving for and have a plan to get there.
Defining goals will give you the focus to achieve them faster, and setting a target date for your goals can help you stay motivated along the way.
3. Know your cash flow.
Knowing how much money you earn and how you spend is key to managing your money. Tracking it is key to making sure you have enough left over to do the things that you want.
4. Shop around to get the best value for your money.
Most people shop around for the best price on a new TV or a litre of milk. Comparison shopping works for money, too. The fees you pay on financial services make a big difference over time. For example, when you renew your mortgage, shop around for the best rate. Even one-tenth of a percentage point can translate to thousands of dollars in the long term.
5. Care more about your money than anyone else does.
Even if you have an advisor or an institution committed to doing their best with your resources, the decisions - and the results - are ultimately your responsibility. Know what you own, track your investment performance and hold your service providers accountable for the services that they provide.
6. Be a saver, not a borrower.
Borrowing makes sense if it helps you acquire something that boosts your net worth. But over time, paying back debt takes away from your ability to save - even when interest rates are low.
7. When it's too good to be true, it usually is.
You've heard the saying, "If it seems too good to be true, it probably is." But if investment scams actually seemed too good, no one would ever be taken in by one. Be very critical, especially of unsolicited requests for your money.
8. The sooner you start, the better off you will be.
Time is money - really. The sooner you start to save and invest your money, the faster it will grow.
IEF offers unbiased financial information to consumers via www.GetSmarterAboutMoney.ca and to students and teachers through www.InspireFinancialLearning.ca and extensive classroom programs. The non-profit organization was established by the Ontario Securities Commission (OSC) and is funded through OSC-enforcement settlements. IEF is a key architect of Ontario's initiative to bring financial education to students in Grades 4 through 12.
SOURCE: Investor Education Fund (IEF)
For further information:
Contact Margo Rapport
Email: [email protected]