Articles for Financial Literacy Month

From: Financial Consumer Agency of Canada

The Financial Consumer Agency of Canada developed the following articles to help individuals and organizations promote financial literacy in communities across Canada.

Article 1: Managing your debt in a changing world

(NC) As the cost-of-living increases and interest rates rise, you may find yourself in a financially difficult situation. If paying down your debt is becoming a challenge, small actions can make a difference. 

Review your budget 

Revisiting your budget is always a good idea. Look carefully to see where you can cut costs to rebalance what you spend versus what you put towards your debt. If you don’t have a budget, you can try the Financial Consumer Agency of Canada’s online budget planner to get started. 

Set a timeframe

Set a payment timeframe that is reasonable, yet still affordable for each debt you owe. If your timeframe is too long, you may lose focus. You’ll also end up paying more money in interest. If your timeframe is too short, you may not be able to keep up with your payments. 

It’s also a good idea to separate the “good debts,” which are usually investments such as a mortgage, and the “bad debts” that are usually something that immediately goes down in value after purchasing. In general, try to prioritize paying down your debt that has the highest interest rate.

Seek advice 

If you’re struggling to keep up with payments, work directly with your creditors or bank to find solutions. They could decide to lower the interest rate on your debt, extend your payments over a longer period and reduce your minimum monthly payment. They could also offer to consolidate your debts into one loan.

If you feel like you’re under water and there is no way for you to ever get on top of your debts, there are still options. A Licensed Insolvency Trustee can help you get back on track. The Office of the Superintendent of Bankruptcy has resources and information you can trust on the matter. 

Find more tips and free, objective resources at

Article 2: Tips to borrow money wisely

(NC) Most Canadians have some form of debt. Not all debt is bad – for example, taking out a student loan can be an investment in your future. But borrowing is something to do wisely – using credit to spend beyond your means can put your budget out of balance. If you need to borrow money, here are some things to keep in mind. 

Shop around for the lowest interest rates

When applying for a credit card, try the Financial Consumer Agency of Canada’s online credit card comparison tool. It examines the interest rates, features and reward programs of many credit cards. The tool offers unbiased, trustworthy information.

If you regularly carry a balance, a low-interest rate card could be the way to go. But if you use your credit card for most of your purchases and pay it right back as you go, getting one with a rewards program could be beneficial to you.

Shopping around is also key when getting a mortgage. Take some time to compare different options such as variable and fixed interest rates, and open and closed mortgages. 

Think twice about “buy now, pay later” offers

Some retailers, such as furniture stores, may offer you credit at 0 per cent interest for a certain term. Be sure to read the fine print and remember to pay your balance in full by the time it is due. If you don’t pay off the balance by this time, the fees and high interest rates will add to your debt load.

Ask yourself these questions

Consider the following before you take out a loan or a line of credit:

  • Do you need the money now or could the expense wait until you’ve saved for it?

  • Do the monthly payments fit into your budget?

  • Will you still be able to afford the payments if interest rates change?

  • What happens if you miss a payment?

You can find more practical tips and tools to help you borrow wisely at

Article 3: Know your rights when applying for a credit card

(NC) Are you applying for your first credit card? Maybe you’re looking to get a card that better suits your needs. Do you know what rights you have? Here’s a snapshot:

When you apply

When you apply for a credit card with a bank, they must provide you with certain information. They must clearly set out the key features of the card in an information box that must be at the beginning of the application form or a separate document that comes with it. This includes details such as the card’s interest rate and other charges such as annual fees. 

With the card

When you receive your credit card, it must have a credit card agreement with it. Read the agreement carefully to understand your responsibilities and the terms and conditions of the card. If there’s something you don’t understand, contact your bank. 

Once you have your card, your issuer must send you a statement, at least once a month, after the last day of each billing cycle. 

When terms change

Your bank may make changes to the features or the terms and conditions of your credit card. If so, they must provide you with the details of these changes in writing. They must do so at least 30 days before the changes take effect. They must also get your express consent before raising your credit limit.

There are some exceptions to this rule, such as a decrease in the interest rate, that do not require advance notice. 

When your balance drops

Your bank must send you electronic alerts when the credit available on your credit card falls below $100 or an amount you’ve set. Your bank will send these alerts to you automatically. You don’t have to sign up, but you may opt out at any time by informing your bank in writing. This could be done by email.

Learn more at

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