Pedagogical Solution to Financial Illiteracy in Canada: Increasing the Accessibility of Higher Education

By: Hannah Muriel Robb Burrows and Floor Nusselder

Department of Psychology, Queen’s University

Copyright © 2023 Hannah Muriel Robb Burrows and Floor Nusselder. All rights reserved.

Recent research from the Financial Consumer Agency of Canada ([FCAC], 2023) reveals that financial hardships for many Canadians increased throughout the COVID-19 pandemic because of rapid changes in the economic environment. Financial vulnerability disproportionately impacted low-income individuals, whereby this population was 1.7 times more likely to experience negative financial outcomes (e.g., high debt; FCAC, 2023). Similarly, individuals with a household income under $40,000 reported higher financial stress due to a perceived inability to fulfil financial commitments (e.g., bill payments; FCAC, 2023). Although Canada is considered one of the most financially literate countries in the world, ranking third out of 29 countries sampled by the Organization for Economic Cooperation and Development ([OECD], 2016), self-report ratings of adults’ perceived financial literacy indicated only 15% of Canadians believe they have strong financial literacy skills (Bazian, 2018). Notably, financial self-efficacy – an individual’s confidence in their ability to achieve financial goals – is an important predictor of their financial behaviour (Mindra et al., 2017) and can increase financial well-being (Dare et al., 2022). Although objective measures may indicate that Canadian adults possess high financial literacy skills, subjective ratings of confidence with these skills (FCAC, 2022), as well as measures indicating financial challenges during the pandemic allude to an important gap.

The skills acquired through education are important to fostering financial literacy. Research by Kaiser and Menkhoff (2017) supports education-based interventions, suggesting that learning opportunities generally have a positive impact on financial literacy. Shim et al. (2010) further demonstrate that parental financial modelling provides an overwhelming influence on young adults’ financial socialization process, producing a sustained effect over time. However, Shim et al. (2010) also identify that high school financial education is another predictor of young adults’ financial knowledge. Important research has further connected financial literacy programs to less debt and increased student assets (Brookings Institution, 2018; Furnham & Cheng, 2019). This research suggests that financial literacy education is beneficial, thus necessitating a further understanding into the factors that drive effective financial literacy education.

When comparing Canada’s financial education to that in Sweden, there is potential for improvement in Canadian financial literacy interventionsFootnote 1 . Notably, Sweden ranks above Canada in this domain, tying with Denmark for the highest financial literacy scores globally (Batsaikhan & Demertzisv, 2018). As noted, subjective ratings of financial literacy among Canadian adults suggest a lack of self-efficacy related to making financial decisions (Bazian, 2018; Dare et al., 2022). This discrepancy is important considering subjective financial knowledge is a strong predictor of an individual’s financial behaviour (Lind et al., 2020). The difference between rates of financial literacy among Canadian and Swedish adults may be due to the accessibility of financial education training. Whereas only 10% of Canadian parents consider their household to be in excellent financial health (TD Bank, 2021), Swedish households report having strong finances, with measured household financial literacy continuing to improve (Financial Supervisory Authority, 2020). Drawing on further evidence from Sweden, increasing accessibility to Higher Education (HEd) in Canada by reducing aspiring students’ financial burdens has the potential to improve financial literacy skills. Tuition for HEd programs in Sweden is free to citizens of the European Union, the European Economic Area, and Switzerland (see Lund University, 2023). In contrast, 54% of post-secondary education graduates in Canada acquire debt to finance their studies (Zeman & Frenette, 2021). Sweden’s greater financial accessibility of HEd, combined with higher rates of financial literacy, alludes to a path forward in addressing Canada’s financial literacy problem.

Preliminary empirical evidence from the United States (U.S.) supports the efficacy of scholarship money and financial aid in increasing post-secondary education attendance. Goldrick-Rab et al. (2016) showed that offering students additional financial aid in the form of grants increased the likelihood they would attain a bachelor’s degree over four years. This financial aid ultimately minimized income inequality in HEd (Goldrick-Rab et al., 2016). Generalizing to a Canadian context, offering low-income students financial aid can increase accessibility to post-secondary education. Additional research reveals that financial aid policies in Canada are less generous to low-income youth compared to the U.S. (Belley et al., 2014). Although the Government of Canada has attempted to offer financial incentives for parents to save by using a Registered Education Savings Plan (RESP), participation rates have not increased among lower-income families (Bonikowska & Frenette, 2020). Of this RESP participation gap, 50-79% has been attributed to differences in wealth across Canadian families, which has further been linked to lower parental levels of education, numeracy, and financial literacy (Bonikowska & Frenette, 2020). Through an intersectional lens that considers socioeconomic status (SES) and access to HEd, we examine evidence that alludes to the relationship between the intergenerational poverty cycle in Canada and financial literacy skills.

Financial Illiteracy in Academic and Applied Literature

Persistent financial illiteracy is problematic because it is a catalyst for systemic issues, including deterring students from pursuing HEd due to financial barriers. In 2019, nearly 1 in 5 children (17.7%) in Canada lived in poverty (Hillel & Sarangi, 2021). Children in Canada raised by low-income parents are vulnerable to intergenerational cycles of poverty because financial services and resources are designed to cater towards middle- to high-income individuals (Prosper Canada Centre for Financial Literacy, 2015). This harmfully inequitable design increases the barriers that children from low-income families face. Students from lower socioeconomic backgrounds further identify limited financial resources as a major barrier to accessing HEd (Hoy et al., 2001; Frenette & Robson, 2011; Weingarten et al., 2015). Relatedly, 34% of 18–24-year-olds in North America choose not to pursue a post-secondary education because of its financial burden (National Student Clearinghouse Research Centre, 2023). This hesitancy to pursue HEd is understandable considering debt for a bachelor’s degree in Canada averages at $28,000 (Statistics Canada, 2023). Similarly, a recent study found that 64% of students who graduated with student debt still had an outstanding debt after three years (Galarneau & Gibson, 2020). Average tuition also continues to rise in full-time undergraduate and graduate programs nation-wide (Statistics Canada, 2021). In 2021, tuition comprised 29.4% of revenue for post-secondary education institutions (Statistics Canada, 2021). Despite these barriers, pursuing a HEd can be greatly beneficial to students.

Not only are employment rates among individuals with any form of post-secondary education higher than those with a secondary school diploma (Statista Research Department, 2023), but the income gap is also greatest between individuals with a secondary school diploma and individuals with a bachelor’s degree (Statistics Canada, 2019). Zeman and Frenette (2021) highlight that income for graduates with a post-secondary education greatly exceeds average student debt levels. Helping students from low-income households or households below the poverty line pursue HEd can further help to stop the cycle of poverty by reducing the income gap (Arnold & Doctoroff, 2003; Clay, 2015). In addition to these benefits, health and well-being effects associated with staying in school include greater social support and greater life satisfaction, which predict lower mortality (Boylan et al., 2022; Kawachi et al., 2010). Given the many positive benefits of HEd, the need for equitable access is important as students from low-income families face many financial and educational barriers to accessing HEd.

This gap highlights the importance of increasing access to HEd. Despite the pervasiveness of financial barriers, millions of dollars of scholarship money in Canada remain unclaimed each year due to a lack of applicants (Chong, 2022; Griffiths, 2022). Moreover, Usher (2022) reports a discrepancy between the domestic tuition fees for HEd and the amount of available public financial aid (i.e., which supports both tuition and living expenses). In 2017-18, the total amount of available non-repayable aid in the form of grants was between $12-13 billion, while the total domestic fees for pursuing HEd in Canada was under $10 billion (Usher, 2022). Even though public universities in Canada receive some of the most government funding per student globally (Williams & Usher, 2022), the income-based demographic discrepancies of enrollment rates in HEd within Canada is concerning. The available funding suggests that Canada has the potential for net-negative tuition fees, but financial barriers to pursing HEd persist. One of these barriers is that students who require financial assistance for higher education may only capitalize on available scholarship money if they have the necessary skills to create a successful application (Hoff, 2013). Similar research by Haveman and Smeeding (2006) showed that students from low-income households are uninformed about the cost of attending college and unaware about available needs-based financial aid. In light of the unused funding, the amount of money that a HEd costs should not be a deterring factor.

Improving Financial Literacy: Access to Higher Education

The aforementioned research has outlined the relationship between HEd and improving overall financial outcomes. However, despite the significant amount of scholarship money and available financial aid unused each year, the cost of HEd is a prominent deterrent for individuals who wish to pursue a post-secondary education. Compelling research discussed previously reveals that individuals do not capitalize on this available money because they lack the skills and self-efficacy to be able to do so (Bazian, 2018; Dare et al., 2022). Moreover, these factors are compounded by an individual’s SES. Specifically, individuals with a high SES are also likely to have some degree of HEd and possess higher financial literacy skills. Considering that approximately 70% of new jobs in Canada require some form of post-secondary education (Morissette, 2023), we propose that helping to increase the financial accessibility of higher education has the potential to improve the population’s financial literacy skills and combat the poverty cycle. Data supports the efficacy of increasing accessibility to financial aid for increasing enrolment rates (see comparison to initiative in the U.S. discussed previously). To reduce the financial barriers that discourage individuals from accessing HEd, we have developed an equitable and accessible, module-based financial application program that strives to connect high school students with the surplus of untapped scholarship money each year. Our proposed solution strives to teach students the necessary financial literacy and application skills that will help them to pursue HEd, ultimately having downstream effects that improve overall financial literacy rates.

The modules include themes related to budgeting, financial planning (see Figure A1), resumé building, scholarship searching, and application writing. The program will be an open access resource for high schools across Canada to embed into their online systems, such as D2L through the eCampusOntario H5P Studio (see Appendix). By having the program available through schools, we strive to optimize accessibility to these resources. This is a critical aspect of the program because the individuals who will most benefit from access to scholarships and financial aid money are often required to work part-time jobs, and thus unable to devote the required time to complete the applications outside of school (Singh, 1998). Providing students with the tools and skills they need to apply for funding helps to foster students' self-efficacy and confidence in their knowledge and skills (Mindra et al., 2017). This can increase the number of people who apply to scholarships, so that financial resources are no longer a major barrier to accessing HEd.

The design of the modules is rooted in empirical evidence from psychological research, incorporating principles from Universal Design for Learning (e.g., multimodal learning; Slattery, 2021). Research on scaffolding, which involves structuring new content using a step-based framework to support students, has shown that it is an extremely effective technique in educational settings (Van de Pol et al., 2010). Research also shows that managing students’ cognitive load by streamlining the amount of information they need to attend to facilitates optimal performance (Siregar, 2021). Furthermore, load management techniques, such as providing cues, are especially effective for novices (Vogel-Walcutt et al., 2011). We have incorporated these techniques into the modules by ensuring each concept is broken down and providing streamlined guidance throughout (see Figure A2). For example, for any module in which we have included a template that students can download, we have also provided a step-by-step video tutorial outlining the purpose of the template and how students can use it. At the end of each module, there is a learning consolidation activity (see Figure A3). These activities are based upon research that demonstrates the expectation of a final test enhances student performance because it encourages ongoing processing of the relevant material (Szpunar et al., 2007). Tutorial videos are included in the modules because research shows that supplementing existing teaching methods with short duration audio-visual media improves learning and engagement (Guo et al., 2014; Noetel et al., 2021). These proposed learning materials will additionally be universally accessible, with appropriate captioning and diverse language translation.

Relationship to Ecosystem Priority

Although the Ministry of Training, Colleges, and Universities (2017) announced a 70% target for HEd attainment by 2020 in Ontario, research reveals a decline in enrollment (Council of Ontario Universities, 2018). As provincial and federal educational mandates have aimed to address the need for financial literacy in Canada (Al-Shibeeb, 2022), declining enrolment trends suggest the implementation of these initiatives have not produced their intended effect. Although initiatives aimed at increasing financial literacy in Canada, such as the National Financial Literacy Strategy (see FCAC, 2021) have provided guidelines to produce and circulate a surplus of educational materials, high school career education courses in Ontario currently do not emphasize content targeting financial aid applications (Ministry of Education, 2019). Furthermore, although well-intended and likely relevant, these resources add additional burdens on teachers because they require additional economic training during professional development days to implement these resources (Henning & Lucey, 2017). With teachers feeling overwhelmed and underqualified, a need for accessible resources that guides students and minimizes teacher facilitation is evident. We aim to address this gap related to available resources by creating interventions that communicate in ways people understand. Through the proposed solution, we aim to help Canadians understand key financial facts, increase accessibility to HEd through an intersectional approach, and increase Canadian adults’ self-efficacy related to financial products and services.

Target Outcome 1: Increasing Factual Understanding of Financial Literacy in Canadians

Although the financial application program will include content that directly targets knowledge gains in financial literacy, such as expense calculation, the primary aim of the program is to help students access HEd because the overwhelming evidence discussed above suggests that post-secondary education mediates increases in financial literacy. Research by Furnham and Cheng (2019) further supports this relationship by showing that educational qualifications were the second strongest predictor of adult savings and investment, following only adults’ subjective financial assessment. By providing self-guided, evidence-based online education for financial resources, the program strives to increase Canadians’ factual understanding of financial literacy. Students will develop the skills necessary to critically evaluate the costs, risks, benefits, and limitations of the financial aid opportunities and services available to them.

Target Outcome 2: Increasing Canadians’ Intersectional Understanding of Financial Literacy

Increasing personalized financial literacy knowledge that is relevant to an individual’s current financial situation is integral to communicating accurate information. This intersectional approach examines and acknowledges how power and privilege intersect throughout society, influencing everyone’s everyday life (Crenshaw, 1989). Notably, an individual’s socioeconomic position often intersects with other social positions, including but not limited to their gender, race, ethnicity, age, nationality, and disability (Gopaldas, 2013). Adopting an intersectional perspective is critical to the process of developing financial resources for Canadians because it reveals potential systemic barriers that may impede access to financial knowledge. For example, research highlights that generational wealth is accumulated through knowledge passed down, strengthening economic security (Block et al., 2019). However, this research also alludes to mechanisms of intergenerational poverty, such that lack of knowledge relates to enduring poor financial decisions. Similar research also demonstrates that representation matters (Fan et al., 2019; Gershenson et al., 2021) because students that feel represented feel a greater sense of belonging in their academic communities, fostering their academic success and learning (Glasford, 2021). Within our program, we aim to have representation implemented throughout our examples, along with inspiring role models with less privileged intersections that have championed these barriers to become successful in the financial space.

Target Outcome 3: Reducing Barriers to Financial Products and Services

Adopting a care-filled approach to teaching risk tolerance and budget constraints is critical to considering the impact of intersectionality and social determinants of health on Canadians’ financial well-being (FCAC, 2020). As part of our solution, we aim to provide students with the necessary skills to obtain financial aid, by applying principles of cognitive psychology that facilitate learning and memory, such as scaffolding. This technique involves structuring new content using a cumulative framework to support students’ learning, assisting in making more complex topics easier to learn step-by step (Van de Pol et al., 2010). This evidence-based approach to teaching and learning ensures that students can effectively synthesize information, increasing the chance they retain the module content.

Data Collection and Assessment of Intervention Efficacy

To assess the intervention’s efficacy, we will measure the solution in Ontario, since it has the highest rate of post-secondary attendance and Canada’s most outsized university system (see Usher, 2022), thus providing a generalizable sample. Using a stratified survey sampling technique, grouping based on school boards, Ontario high schools will be invited until we recruit ten high schools willing to participate in our study. We would then randomly assign five high schools to the experimental group, who would receive our program intervention, and five high schools to the control group, who would follow the current Ontario career education curriculum without the program supplement. We would aim to survey each school’s entire graduating class, following up after 4 years to see if the intervention was successful in HEd.

As more longitudinal data in financial literacy research is needed (see FCAC, 2020), we would collect pre-test, test, and post-test data to assess the effectiveness of our program at various time points in the pilot study. This pre-test measure would help us to survey baseline barriers for scholarship applications and contextualize the efficacy and limitations of our experimental methodology (the program intervention). The survey would collect information related to students’ post-secondary education enrollment intentions (e.g., students’ intentions to apply to post-secondary, students’ intentions to apply for scholarships, scholarship application deterrents). The pre-test measure would aim to establish students’ perceived self-efficacy related to knowledge of the scholarship applications process and financial literacy skills. The test phase of the intervention would be the implementation of the program in the experimental group schools, where students will participate in the modules and apply this new knowledge to HEd and scholarship applications. To aid in the facilitation of this intervention, guidance counsellors, librarians, and other geographically specified interested parties in each school would be a primary resource if questions arise, with the opportunity to contact the creators of the program if needed.

We would measure the outcome of our program when participants graduate high school. Based on the learning outcomes stipulated within each of the modules, data would be collected to assess the efficacy of consolidating each skill and students perceived self-efficacy following exposure to the program. We would collect additional data regarding post-secondary education enrollment rates, the average amount of financial aid accumulated per student, and qualitative data related to scholarship applications (e.g., If you did not apply to a scholarship, please explain why). The survey would collect information related to students’ post-secondary education enrollment intentions (e.g., the name of their institution, their faculty, why they chose not to apply if they selected no), financial aid (e.g., whether participants applied for a scholarship or financial aid, how much money they received, or why they decided not to apply for scholarships or financial aid), and for general feedback about the program (e.g., whether participants found the program helpful, suggestions for improvement). As part of our post-test measure, we strive to evaluate the feasibility of implementing the program in high schools. We will include teachers and principals from our sampled high schools in the first follow-up. To examine the sustained effects of our intervention, we would continue data collection on these students after they complete their first year of HEd to assess whether they submit subsequent scholarship applications. This longitudinal data collection would allow us to assess the feasibility of our program on a structural level and to allow students to provide feedback accordingly.

The goal of this assessment is to perform a formal program evaluation and to identify opportunities for improvement of the proposed intervention. The purpose of these measures is to obtain feedback on how to strengthen the program further and to achieve the desired outcome of improving Canadians’ financial literacy mediated through greater access to HEd. We hope to obtain current and fast feedback to ultimately meet the needs of local communities for the strongest possible intervention, as these needs may vary across Ontario, and diversify more generally across Canada. Considering this, we anticipate observing four trends of improvement in our target population based on the literature available to date. First, we aim to see a higher post-secondary education enrollment rate upon high school graduation for students that have had the financial program training, consistent with research (Frenette & Robson, 2011; Hoy et al., 2001; Weingarten et al., 2015). Second, we anticipate students will have higher financial self-efficacy related to applying for and obtaining financial aid following program completion. Third, we aim to see higher rates of completion within the financial literacy group for obtaining their planned HEd. Finally, we expect to see a smaller amount of debt from the financial literacy group of students upon their graduation from their HEd program.


The current paper highlights the need to reduce barriers to HEd through increasing financial literacy. Parents are generally key informants for their children’s financial knowledge (Bleazard, 2020). However, this generational knowledge intersects with important social determinants (e.g., income and class). The impact of intersectionality suggests that increasing access to HEd will mitigate the effects of important contextual themes, from educational attainment to making financial decisions. Our proposed solution provides students with interactive and situationally specific materials to assist in their budgeting, expense calculations, and personal capability of achieving HEd. Providing access outside of school increases opportunities for students to discuss the finance-related content with their parents, while simultaneously providing an evidence-based guideline to developing financial literacy skills. Alignment of these domains allows us to effectively address ecosystem priority one through our module-based intervention.



This appendix consists of screenshots demonstrating the appearance of the interactive module-based programFootnote 2.

Figure A1

Module 1: Expense Calculation

Screen shot of Module 1: Expense calculation

Note. This figure shows an example of the learning objectives provided at the beginning of each module.

Figure A2

Scaffolded Tutorial Video

Screenshot: Scaffolded tutorial video

Note. This figure shows an example of a video tutorial on implementing key words into a resume, building on principles of scaffolding.

Figure A3

Learning Consolidation Activities

Screenshot: Learning Consolidation Activities

Note. This figure shows an example of a learning consolidation exercise at the end of each module.

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