Welcome address by Dr. Supriya Syal, Deputy Commissioner, Research, Policy and Education, Financial Consumer Agency of Canada, at the Chartered Professional Accountants of Canada's Financial Literacy Virtual World Tour, November 2020

November 5, 2020
Virtual event, Ottawa, Ontario

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Good morning everyone.  

I want to thank CPA Canada for the opportunity to join this wonderful event, the Financial Literacy Virtual World Tour.

I like that title – because it makes me feel like I’m traveling around the world, even when I can’t.

I am happy to be speaking with you today about this important and timely theme, which is Financial Education on the Global Stage.

For those of you who don’t know me, I joined the Agency this fall as the new Deputy Commissioner of Research, Policy and Education.

In this role, I look forward to getting to know you more in the coming months as I learn about the incredible work done by CPA Canada and its members to strengthen the financial literacy of Canadians. 

At the Financial Consumer Agency of Canada, our mandate is to protect financial consumers. 

We do this in two ways: by strengthening the financial literacy of Canadians, and by promoting the compliance of federally regulated financial institutions.

This week, we launched the 10th Anniversary of Financial Literacy Month, and we have a number of events and activities planned, which I hope you will support. 

As we mark the 10th anniversary, it is a time to reflect on our successes and the progress we have made.

But it is also—and perhaps more importantly, a time to contemplate how we can create a better path forward.

I would argue that financial literacy matters more than ever today.

In recent years, the financial marketplace has grown increasingly complex. And with more and more financial services moving online, the links between financial literacy and digital literacy are now in need of our attention more so than ever before. 

And I am not speaking with you in person, but from my home because we are in the midst of an un-precedented worldwide pandemic. 

As a result of which Canadians – and people around the world —are facing new financial challenges and uncertainty.

To that point, I’d like to take a moment to offer you a first glimpse at our new research findings on the impact of
COVID-19 on the financial situations of Canadians.

These come from a monthly survey to assess the impact of this crisis on Canadians’ day-to-day finances and financial well-being. 

Unsurprisingly, our initial results show that people have faced considerable financial stress since the start of the pandemic; 50% of Canadians reported financial impact due to COVID-19; three out of four people (74%) reported an increase in stress; and among those who have debt, 1 in 3 said they have increased debt, and 2 in 3 said they attribute the increase to COVID-19.

And we’re able to compare these findings to the responses of Canadians on our Canadian Financial Capabilities Survey in 2019.

In 2019, 20-29% of Canadians were carrying outstanding balances on their credit products. Today, that number is 31-34%.

On the bright side, 66% of Canadians were spending within their means in 2019. Today, that number has risen to 8 in 10.

And the proportion of people who report they are budgeting is the highest it has been in 6 years, and people are feeling more knowledgeable about their finances.

So what does this data tell us? Not surprisingly, people are struggling to deal with the financial impacts of COVID-19.

But, it is also telling us that financial literacy can make a difference, especially when times are challenging.

It is critical that we continue, expand, and INNOVATE in our efforts to equip Canadians with the tools and information they need to make informed financial decisions.

That’s why, FCAC, and the broader financial literacy community as a whole, have made sharing information about financial management with Canadians a priority, such as our current web content to help people manage their finances during the COVID-19 pandemic, which is updated as benefit programs evolve. 

I want to quickly mention 2 other innovative initiatives we have:

One is our Budget Planner tool. I’m sure you’re aware of the wealth of research that points to the importance of making a budget. But a common issue is that people don’t know where to start! One of the things people often say when asked about budgeting is that they don’t know where to start.

So we created a new budgeting tool, which is a mobile-friendly interactive tool that helps people EASILY create a budget, and also provides tips, suggestions, and alerts. Something many of your clients could use, so please check it out. 

The second initiative I want to mention is our ongoing experimental pilot on refund to savings which tries to get people to deposit their tax refund into a savings account. 

This is based on similar work in the US which has been very successful – for example in the 2015-2016 tax year 30,000 US families saved $48 million. 

More than 40,000 people took part in our Canadian pilot. 

We are expecting our results back any day now, but as a sneak preview, 9.6% of people in our sample pre-committed to save their refund, which is a 26% higher uptake that U.S. researchers saw, so we’re excited to see what our data reveals!

And because we know that when it comes to finances, humans aren’t always rational, even in a virtual room full of accountants, both our Budget Planner and our refund to savings project use behavioural insights to help encourage budgeting and saving.

Before I let you go, I’ll again mention that November 2020 is the 10th Anniversary of Financial Literacy Month. With that in mind, our 10th anniversary campaign centres on the "10 Things you should know in times of financial uncertainty.”  

Or, as I like to call them, the 10 Commandments of Financial Literacy.

One, is making a budget, and you can find the rest at Canada.ca/Financial-Literacy-Month, where you will also find a link to FCAC’s Budget Planner tool.

In addition to the events going on around the country, we are launching public consultations on the renewal of our financial literacy strategy this month.

It is my hope that these consultations will help us determine the best measurable and evidence-based approaches for equipping Canadians with the financial knowledge, skills and confidence they need for the road ahead. 

I know that many of you present here today have valuable insights based on your many years of experience and front-line work.

So I would very much appreciate it if you could join our consultations or provide feedback and ideas via our consultation website on how we can advance financial literacy in Canada: Letstalkfinancialliteracy.ca.

Lastly, I’ll say we are living in a time when many people are facing heightened financial stress and uncertainty. 

We know from research into financial decision-making that our minds work differently, and we make decisions differently, in times of stress and uncertainty – in fact, scarcity of resources, such as money, can impose a cognitive tax on people.

The importance of financial resilience is evident, perhaps now more than ever, and we need to make sure that we are doing the very best we can to help Canadians build the financial literacy that will lead to that resilience. 

At the Financial Consumer Agency of Canada, we offer a wide range of unbiased and fact-based educational material, financial tools, and financial literacy programs that can help, so we encourage you and your clients to make use of these resources through our Canadian Financial Literacy Database.

We have made significant progress in the past 10 years, and I am certainly looking forward to the next 10, and to helping shape the future of financial literacy with you.

I know we can count on your support in enhancing the financial literacy of people all over our beautiful country, and I want you to know that you can count on ours.

Thank you.