Wednesday, October 8, 2014

United Way Edmonton Poverty Simulation Provides Much Needed Perspecitve & Empathy



My friend Joanne Curry runs the Poverty Simulation exercise for United Way Edmonton and I attended the full morning session today at the Telus Space and Science centre, eager to learn what it was all about, but not without some trepidation.

My anxiety grew along with the real stress of trying to live and navigate the basics of life through the morning of challenges.  Even though I knew it was a simulation, the experience felt real as my two pretend children (ages 14 and 17) sat around (one was lured into taking drugs) while I tried to figure out how to juggle working, transportation, government benefits/assistance, paying rent and hooking utilities back up that were cut off.  My success?  I, as Felicia Fuentes, single mother who was left by her husband with $10 cash, no bank account and no job failed miserably, as did everyone else in the room.  Zero options was the theme of my challenge.  And although I found success (meager as it was) by landing a keeping a job that didn't even pay the bills, I realized quickly that "win" now cut my "family" off from much needed government support.  At the end of my challenge, my family went without food for 4 weeks.  It might sound ridiculous, but it drove home the fact that there are far too many Edmontonians and Canadians, desperately trying to make a better life for themselves.  But, because of the loss or abandonment of a spouse, layoff, high cost of housing, utilities, childcare and more, they're barely making it or a small step away from being completely homeless.

This simulation was excellently executed with much time for needed sharing within mini groups and then the entire room for introspection (there was nearly 100 people in attendance).  The group shared how their stereotypes of low income and the homeless were shattered in their minds.  They felt the "system" was set up for an endless cycle of despair.  We realized first hand that when you're at the poverty line, life costs more. Things get cut off, suppliers take advantage of you because your choices are fewer, you pay more for running around in circles and you almost never stand up for yourself or negotiate because you're just trying to survive.

Having been raised by a single mom myself (I have no idea how she raised the three of us with the grace and strength that she did), I had to choke back tears a few times when the simulation reminded me of her own struggles.

One lady in our group shared how as she played the role of a 9 year-old in her "family", she was keenly aware of their lack of money, lack of opportunities and more.  She emotionally declared that a child shouldn't be robbed of their youth by living with and knowing their family's financial turmoil, but it's simply not an option for some.

I highly encourage you and those you know to take a few hours out of your day and attend this humbling and rewarding experience.  Our city would be a more kind and empathetic place for us all knowing what it's like for far too many of our fellow citizens.  As my husband says, "money is not the root of all evil; a lack of money is".  Indeed, many in the simulation resorted to crime or drugs as a way to make ends meet or cope.  It was only the lack of financial resources and the necessity for them and their families to survive that forced them to make unthinkable choices.  Rather, it was their only option - not a choice many times.  Check the simulation out and register today: http://myunitedway.ca/poverty-simulation

Joanne shared some further sobering statistics at the end of our session:
  •  13,000 Edmontonians rely on the Foodbank each month, but those in need may only access this service once per month.
  • 2,174 Edmontonians are without a permanent home - 279 are children and youth.
  • $10.20 per hour is Alberta's minimum wage.  Yet the wage per hour needed to ensure Albertans have the basic essentials for living is $17.29 per hour without benefits and $16.14 per hour with benefits.
  • 52% of Alberta's children living in poverty are in households where one or more people have full-time employment.
Reach out to the United Way Edmonton today to make a donation, volunteer or attend a future Poverty Simulation and let's build a wealthier, healthier Edmonton together!

Saturday, September 27, 2014

Building your budget from the Marilyn Denis Show


I hate budgets just about as much as I despise diets. Good financial choices have to be a long term lifestyle choice. Chatted about not-so-painful tips on The Marilyn Denis Show last week. Check out our advice and easy to follow tips!

http://www.marilyn.ca/Finance/segments/Daily/September2014/9_23_2014/BuildingyourBudget

The changing face of wealth - women!



It was wonderful to be back on BNN last week with Larry Berman on Berman's call.  I was in Toronto speaking at CIBC's Wealth Management, National Business Conference about the Top 10 Practical Tips for Engaging & Attracting More Female Clients.

Here's a link to the segment: 


A recent Globe and Mail article from August revealed some of the following statistics about women and investing:
  • $2.6 trillion in financial wealth will be controlled by women retirees by 2022
  • 90% of Canadian women will have complete control of finances at some point
  • A widowed baby boomer is expected to outlive her spouse by an average of 16 years
  • 70% of women change financial advisers within a year of their partner’s death
Others have been doing work in this area too: Emery University did a study using fMRI that revealed that when making financial decisions women secrete more stress hormones than men. Women and men are simply different, from their brains to their emotions to why and how they relate to investment decisions. When a woman is stressed, she releases oxytocin – the “tend and befriend” hormone. A man releases adrenaline when stressed – activating his “fight or flight” response.

Russ Allen Prince, president of R.A. Prince & Associates, Inc., is internationally recognized as one of the foremost authorities on the private wealth industry. A prolific writer, he’s penned more than forty books including, Profitable Brilliance and The Family Office. He is a founder and the Executive Director of Private Wealth magazine and writes the Serious Money column in Forbes. His study of affluent women found that just over 41% are “afraid” when they make financial decisions.

In my last book A Canadian’s Guide to Money-Smart Living I had some specific advice for families so that both spouses are on the “same page” when it comes to investment goals.
  1. Six step conversation:
  2. What are our goals
  3. Needs and wants list
  4. Where are we now
  5. How are we going to get there
  6. Any changes
  7. Action plan
Download Kelley’s award (EIFLE) winning book ($3.99) on the CPA Canada website

I'm honoured to have been named as a member of the National Steering Committee on Financial Literacy and will be moderating a session for the National Conference on Financial Literacy in Vancouver early November.  I will also be speaking about avoiding financial fraud (Vancouver, Edmonton) during Larry Berman's upcoming Canada-wide educational speaking tour.

Hear Larry Berman and members of his investment committee speak live. Register for Larry’s fall speaking tour here

Should grads save in a TFSA and what are the basics?


 In Toronto last week, City TV asked me to join their evening news to explain the basics of the oft misunderstood Tax Free Savings Account.

You can view the segment here:


Friday, August 1, 2014

Government of Canada announces members of Canada’s National Steering Committee on Financial Literacy

I'm honoured to be named as one of the members of the National Steering Committee on Financial Literacy.

Government of Canada announces members of Canada’s National Steering Committee on Financial Literacy

Steering Committee to assist in implementing a national strategy on financial literacy

July 30, 2014 – Ottawa, Ontario – Financial Consumer Agency of Canada

Canada’s Minister of State (Finance) Kevin Sorenson and Canada’s first Financial Literacy Leader Jane Rooney today announced the members of the newly formed National Steering Committee on Financial Literacy. The 15 committee members were announced at an event held at the Central YMCA in Toronto.

Committee members were selected from over 100 applicants, representing a broad range of organizations from the public, private and non-profit sectors across Canada. They will provide leadership and promote participation in financial literacy initiatives within the sectors they represent, and help to ensure an effective and collaborative approach is used in implementing a national strategy for financial literacy.

Quick facts
  • Committee members were selected from an open, online application process, with applications received from individuals, as well as from public, private and non-profit organizations across Canada.
  • More than 100 applications were received.
  • Members of the Committee were selected considering their roles, experience and achievements.
  • Preference was given to candidates who had financial education experience in working with important groups such as seniors, Aboriginal Canadians, newcomers, youth and low-income Canadians.
  • Members are given a two year term at which point a new committee will be selected with the opportunity for reappointment of former members.
  • Members’ responsibilities will include:
    • providing advice and insight on issues related to financial literacy to the Financial Literacy Leader
    • acting as champions by promoting a national strategy to stakeholders and encouraging participation in its development
    • facilitating coordination and collaboration to initiate financial literacy programs and activities that align with the national strategy’s goals and priorities, and securing commitments from organizations within their sectors
    • participating actively by implementing projects or activities within their organizations that contribute to the goals of the national strategy, and
    • monitoring progress and reporting to the Leader on the progress of their respective sectors in moving the national strategy forward.
Members of Canada’s National Steering Committee on Financial Literacy
  • Camille Beaudoin, Autorité des marchés financiers
  • Leslie Byrnes, Canadian Life & Health Insurance Association
  • Laurie Campbell, Credit Canada Debt Solutions
  • Terry Campbell, Canadian Bankers Association
  • Shelley Clayton, University of New Brunswick Financial Aid Office
  • Mary Condon, Ontario Securities Commission
  • Pat Foran, CTV News
  • Suzanne Gendron, Mouvement Desjardins
  • Terry Goodtrack, Aboriginal Financial Officers Association of Canada
  • Kelley Keehn, Financial author
  • Cary List, Financial Planning Standards Council
  • Elizabeth Mulholland, Prosper Canada
  • Andrew Nicholson, Financial and Consumer Services Commission of New Brunswick
  • Gary Rabbior, Canadian Foundation for Economic Education
  • Cairine Wilson, Chartered Professional Accountants of Canada
For more information on the Committee members, read their biographies.

Quotes
“We know that when Canadians have the right financial knowledge, they can make wise financial decisions, strengthening our entire economy. That’s why the Harper Government is committed to strengthening the financial literacy of Canadians and the members selected for the National Steering Committee on Financial Literacy reflect the wide spectrum of experience and expertise needed to accomplish that goal.”
—Kevin Sorenson, Minister of State (Finance)

“I look forward to working closely with the committee members to develop and implement the national strategy for financial literacy. My role to collaborate and coordinate financial literacy initiatives is greatly enhanced by the leadership and dedication to financial education demonstrated by the committee members.”
—Jane Rooney, Financial Literacy Leader

Associated Links
Contacts
Office of the Minister of State (Finance)
Meagan Murdoch
Communications
613-996-7861
Follow @financecanada on Twitter

Financial Consumer Agency of Canada
Media Relations
1-866-461-3222
media@fcac-acfc.gc.ca
Follow @FCACan on Twitter
Like Financial Consumer Agency of Canada (FCAC) on Facebook
Subscribe to FCACan on YouTube
Follow Financial Consumer Agency of Canada on LinkedIn

Financial Literacy Leader
leader-chef@fcac-acfc.gc.ca
#FinLitLeader on Twitter
Like Financial Literacy Month in Canada on Facebook
Join the Financial Literacy in Canada group on LinkedIn

Thursday, July 24, 2014

Students get failing grades in finance

School may be out, but students still have a lot to learn.
We’re not talking physics, philosophy or anatomy. When it comes to money, most university and college students and grads are clueless about basic financial literacy.
Kelley Keehn says students need to spend “five minutes a day” learning about their finances, whether it’s examining a credit card bill or making a list of goals. (Sun Media News Services)
Kelley Keehn says students need to spend “five minutes a day” learning about their finances, whether it’s examining a credit card bill or making a list of goals. (Sun Media News Services)

Post-secondary students are drowning in record student loan debts and don’t know the first thing about personal finances, experts say. According to a recent Money Matters on Campus survey, most respondents couldn’t answer six basic financial knowledge questions.

Financial illiteracy in Canada is high, says personal financial adviser Kelley Keehn.

“Students are looking to their parents to teach them financial basics, but their parents don’t know where to start — they’re not financially literate either!”

According to Keehn, “it’s insane that grads are entering the workforce or wrapping up their schooling without financial basics.” But it’s like health — “too often we don’t address this area of our life until there’s a glaring problem.”

Student financial stresses abound: 27 per cent worry about money, more than finding a job or their grades.

“Furthermore, 32 per cent of students have significant trouble paying their bills while at school and thousands of students each year are withdrawing from their program before graduation,” according to a 2013 BMO student survey.

“With the added anxiety of having to start paying their student loans only six months after graduating, it’s no mystery that students have to make hard financial choices, and many of them because of a lack of financial education and planning that could devastate their personal monetary future,” says Keehn, speaker and author at kelleykeehn.com.

She strongly advises spending five minutes a day learning about something in your financial life.
“Open up your credit card statements and examine every detail. Make financial goals and want lists — make it a priority in your life.”

Be sure to hit the books — money books, that is.

“After graduating is not an optimal time to do a crash course on budgets and living within your means,” financial expert Nathan Dungan says. “Suffice it to say it can be a harsh transition for grads when the First Bank of Mom and Dad is no longer open for business.”

With our society moving towards a cashless world, it’s even more dangerous for young people.

“Students don’t understand the tangibility of money,” Keehn says. “They’ve rarely held money in their hands or computed, ‘If I want to buy these shoes or go out with my friends to the movies, here’s the amount of cash I need and here’s how long it took me to earn it.’ They don’t understand negotiating skills and basics like shopping around for a better rate on their student loans.”

Keehn stresses that students need to examine needs vs. wants, and learn how to prioritize and how to save up for wants. They also need to realize the importance of a good credit score and how quickly it can be ruined.

Get educated on the cost of debt because it costs — lots! And learn the magic of compound interest, Keehn says.

“Einstein said it should have been the eighth wonder of the world…‘Those that understand it, have it and those that don’t, pay it.’”

— JOANNE RICHARD, Sun Media News Services

FP summer school: Making compounding interest your friend

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Illustration by Mike Faille, National Post

Summer school isn’t punishment. Think of it as a second chance or bonus education. So whether you’re trying to repair your finances, make more cash or make smarter money decisions, we’re here to help. FP’s back to basics series continues with a lesson in compound interest.


It’s been called magical. A miracle. The eighth wonder of the world. You’d think it was a supernatural aura or a spectacular monument, but nope, it’s compounding interest.



Saving money can be hard. It involves discipline, sacrifice and planning. It involves putting aside today’s wants for future needs.

For motivation, think of the big picture, think about your goals, whether you’re saving for a home, education, retirement or a vacation. Continue reading

What exactly is that? Think of it as interest on interest. It’s interest on your initial principal and then on the accumulated interest. And think of its power like the Force. Depending on how it is used, the power can be good or evil. It can be your friend or your enemy depending on whether you earn it or you pay it.

How to make compounding interest your friend:

Time can turn compounding interest into your BFF. This friendship just grows and grows over the years and before you know it, it’s this huge, valuable asset that supports you.

“It’s like a snowball. You start with a little thing and it rolls down the hill and one day, you think, ‘Wow, I have a little nest-egg!’” says Kelley Keehn, author of A Canadian’s Guide to Money Smart Living. “We as Canadians, we hate to crunch numbers but numbers are our friends.”

Let’s say you invested $1,000 and it earned 5% in interest last year. Today, you’d be earning interest on $1,050.

Now, let’s say you left $1,000 in the bank to grow for 30 years with a 5% rate of return, compounded annually; even if you never added any more money, you’d have more than $4,300.

In other words, compounding interest can only be your best bud if you are patient.

“When you put something away compounding for a number of years, make sure you can stand that,” says Adrian Mastracci, a portfolio manager and president of KCM Wealth Management in Vancouver. “Or the chances of getting out of it with something in your pocket is not very good in terms of interest.”

Our low interest rates have dulled the potency of compounding interest with traditionally safe savings vehicles such as GICs and bonds. “Fourteen years ago, you got 5, 6, 7% on your GICs. You’d be excited to get 2% or 3% these days. On the plus side, inflation used to be higher so the net to you today is not bad.”

Whether you’ve invested your money in GICs, term deposits, mutual funds, stocks, bonds, exchange-traded funds, etc., where should you put your compounding interest? How about somewhere it can grow tax-free? “Because interest is taxed at the highest rate, that’s a good reason to put it in an RRSP or a TFSA or an RESP,” he says. “With a TFSA, you might be better with dividends and capital gains by buying stocks.”

Read the full article here