The gift of financial literacy — for seniors

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This article was published 02/12/2023 (1030 days ago), so information in it may no longer be current.

The holiday season is among many folks’ favourite times of the year.

But it’s also got a less festive underbelly. Christmas can indeed be blue, accentuating loneliness as it seems like everyone else is getting together. Add in a rough couple of years of fast-rising prices for rent, groceries and just about everything else, and the holidays don’t just seem blue.

There’s a big dash of red to the season — as in sinking into debt to make ends meet, let alone buy gifts.

Some seniors may feel especially financially pinched and lonely. Many have experienced loss of friends, spouses and even children. And they feel financial pressures, from living on tight fixed budgets to the demands of helping their family.

What’s more, few have reliable financial literacy resources for help, says Gary Rabbior, president of the Canadian Foundation for Economic Education (CFEE).

“The reality is that hardly anybody has comprehensive education and support for financial affairs,” he says, noting CFEE has been focused for years on boosting financial literacy for youth inside and outside of schools.

“We have an incredibly successful resource called Money and Youth,” of which more than 750,000 copies have gone to households and schools across Canada.

Yet seniors have long been on CFEE’s radar.

After all, aging Canadians arguably face the most challenging financial decisions from retirement income planning to end-of-life decisions.

In turn, CFEE officially launched in November, at the Canadian Museum for Human Rights, a new online financial literacy resource called Money and You: Seniors Edition.

Consider it a free holiday gift of knowledge covering just about every angle of finances for people as they reach retirement and beyond.

“We’re big fans of the ‘just in time’ learning method, especially for older individuals,” says Rabbior, noting the resource consists of nearly 500 pages of material — in a large font — across 13 modules that can be downloaded individually and printed off.

“So all of a sudden you need to have a power of attorney; what do you need to know about that?”

Indeed, module No. 12, Inevitability — Planning for End of Life, helps answer that big question.

Other modules tackle retirement income planning, travel, housing and government pension programs.

The resource couldn’t come at a better time, given the time of year and economic conditions.

It’s also heartening that it is wide-ranging, given how diverse Canada’s aging population is, says Dr. Verena Menec, professor in the department of community health sciences at the University of Manitoba, and the Canada Research Chair on Healthy Aging.

“Even if you talk about age, it’s 55 to 100 plus so it’s an enormous range, and it’s the same thing with income with some very well-off people.”

Yet the need for help among aging seniors, who are low income, is rising with more using food banks than in the past, Menec says.

At the same time, aging individuals are at higher risk of isolation and loneliness — amplified at this time of year, she says.

“Research shows that loneliness and social isolation are associated with susceptibility to fraud.”

It’s not just stranger danger when it comes to separating aging Canadians from their money with increasingly sophisticated scams.

It’s people close to them, according to a Government of Canada resource on elder abuse highlighting the increased risk of financial abuse. Certainly that includes scams perpetrated by organized criminals. But the resource also notes that financial abusers can be family members and caregivers.

And given the pressures all Canadians face at this time of year financially, it’s likely some of us even know of a relationship between an aging person and their family or friend that may fit the description.

An even more common concern is rising debt-loads among seniors, which the CFEE resources addresses, highlighting Statistics Canada data showing debt among seniors increased from 27 per cent in 1999 to 42 per cent in 2016.

It’s likely debt levels have risen even more as baby boomers and younger generations are aging into senior-hood, given their increased familiarity with debt, says Dr. Wayne Simpson, economics professor at the University of Manitoba.

“I think there is a difference between us and our parents,” says Simpson, a baby boomer himself.

“I don’t think we’re as careful as them with debt, and the generations that have followed are maybe even more used to living on the edge with borrowing.”

He points to how living through the Great Depression left a mark on his parents and a focus on living within their means and setting aside as much savings as possible for hard times.

Of course, it’s much easier to borrow money than ever before, he adds.

Twenty-five years ago, home equity lines of credit were a rarity, and credit cards, although widespread, were nowhere near as ubiquitous as they are today.

Research shows rising credit card use even in the 1980s and 1990s (when their use was less than today) correlated to higher bankruptcy rates.

All of this is to say that seniors — and for that matter everyone because we’ll all be seniors one day, good fortune abiding — need as much unbiased knowledge as we can get.

To that end, Rabbior says the new Money and You: Seniors Edition is meant for more than folks over age 65.

“One of the things we’re increasingly looking to do is provide support for seniors in having discussions with their adult children,” including end of life decisions that include financial ones like designating a power of attorney.

Yet even beyond seniors discussing their finances with adult children, the CFEE resource is worth a look for anyone who wants to retire well.

“Growing old can be challenging, and the better you are at understanding what lies ahead and how to prepare for it, the better off you will be,” he says.