Canadians and Their Money

Programs for SavingIn our deliberations, many participants expressed concern that some groups ofCanadians are not saving, or not saving enough, thus pointing to Canada’s low (byhistorical standards) personal saving rate. The problem was attributed to a numberof factors, including:• A culture that tends to encourage consumption and immediate gratification;• A lack of awareness or understanding of government-supported saving vehicles,such as Registered Education Savings Plans (RESPs), Canada Education SavingsGrants, Canada Learning Bonds and Registered Disability Savings Plan grants;• Concern that many Canadians lack the financial means to save; and• Behavioural biases: young people, for instance,“In these ever-increasing complex financial decisions, wehave a tendency to discount the future.must make it easier for consumers to make wise financialchoices. One of the recommendations we talk about inSaving is a basic but essential financial activity, our submission is about changing the architecture ofchoice, designing choices so that Canadians, with respectranging from setting aside money for smallto retirement savings, are nudged towards makingpurchases to saving for retirement, and can be choices that could be in their better financial interest.”done at virtually any time. With people taking on – Canadian Foundation for Advancement of Investor Rightsgreater responsibility for funding their retirementtoday, the value of saving and building a “nest egg” for the future cannot beunderestimated. Moreover, significant improvements in life expectancy make itdifficult for Canadians to accurately predict the length of their retirement. Thisrequires a plan that contemplates lifestyle, resources, unforeseen events and otherfactors within a time frame that can last anywhere from several years to severaldecades. Our recommendations contemplate not only saving, but also the value ofbuilding a better understanding of options available to Canadians to manage therisks of outliving their assets (e.g., guaranteed income stream through retirement).In other sections of this report we discuss ways to help Canadians become bettersavers. Instruction delivered in school, beginning at a young age, on basic budgetingtechniques and the difference between “needs” and “wants” is a natural startingpoint. The creation of a public awareness campaign focused on the importance ofTASK FORCE ON FINANCIAL LITERACY – III. Lifelong Learning 57