From credit card debt to student loans, many young consumers struggle with managing their money. November is financial literacy month and according to a new survey, a majority of Canadians are now concerned about their children's financial future.

I have a new book "The Smart, Savvy Young Consumer" dedicated to helping young people become better spenders and savers.

I believe that many young Canadians are not learning enough about money matters such as credit cards, interest rates, bank loans, mortgages, investing and tax issues. I have always thought that a mandatory financial literacy course would be a great addition to the high school curriculum. When I was in chemistry I used a Bunsen burner -- but when I finished high school I never used one again! I think if I would have taken a course explaining credit card interest, car loans, mortgages and how your credit score works I would have been further ahead.

I hear from young Canadians who feel overwhelmed with student loans and credit card debt. They realize too late that while it's easy to dig yourself into debt it's much harder to dig yourself out of it.

Unfortunately, there may also be struggles ahead for young people their parents did not face.

They may have more difficulties in finding a job and raises may not come as quickly as in the past. They may have to switch careers several times through their lifetime. Young people may also not have a traditional pension plan, meaning they will have to make sure they invest to create a nest egg for their retirement.

The good news is that if someone starts off early in life with good saving and spending habits they can be financially self-sufficient, avoid debt and be less stressed about their financial future.

I also believe that young people should open a Tax Free Savings Account (TFSA) as soon as they are able to and put away even $50 a month to start. You can open a TFSA as soon as you turn 18 and if you invest a certain amount of money every month you will have three very important things going for you. You will be paying yourself first, taking advantage of dollar-cost averaging and using the magic of compound interest.

The chart below shows how over time $200 a month can accumulate to over one million dollars. I know a 10% return may seem unheard of now. But over the past 40 years the stock market has been able to return about 8% on many balanced funds.

I hope the information in my new book can help young Canadians make wise decisions about their future.

For more information on "The Smart, Savvy Young Consumer," visit


Years   Amount Invested    Invested at 6%     Invested at 10%

10        $24,000                    $33,531                 $42,074

20        $48,000                    $93,582                 $151,206

30        $72,000                    $201,124               $434,264

40        $96,000                    $393,714               $1,168,444

Key Points:

  • "The Smart Savvy Young Consumer" examines topics covering everything from maintaining a good credit score, to avoiding unnecessary debt, paying off student loans, saving money on car insurance, cell phones and groceries as well as the benefits of dollar cost averaging, compound interest and the Tax Free Savings Account.
  • Pat was a member of the Federal Financial Literacy Task Force that travelled across Canada speaking to Canadians about financial issues.
  • November is also Financial Literacy month and a recent survey by the Knowledge Bureau finds Canadian families are concerned about their children's financial future.
  • The poll found 97% of parents feel that financial literacy should be taught in school and 91% of adults also feel young people don't have a good understanding of credit cards, bank loans, interest rates and other financial issue.
  • A Survey by the B.C. Securities Commission also found that average high school students believes they will be earning $90,000 and have bought their own home by the time they are 28 years old.