There’s never been a time where the female population’s lack of financial literacy has been more apparent. I know, it’s a bold statement but it’s true. You won’t be hard-pressed to think of reasons why, since the pandemic recession highlighted plenty of them. 

Even Canada’s department of finance recognized the fact that women were hit earlier and harder by the effects of Covid-19 and their jobs have continued to recover at a slower pace. Since early 2020, the labour market is one of the areas in which the country’s long-standing gender inequities have been amplified. 

In fact, 42 per cent of women reported worrying more than men (35 per cent) about their finances for reasons such as having to drop out of the workforce due to lack of access to childcare. Leading up to Christmas, this reveals an even bigger cause for concern. 

Why? Well for starters, money spent on holiday shopping often leaves people in a stressful position financially. It’s easy to tack on debt around this time of year and the negative impact of the pandemic isn’t helping any. 

Follow These 10 Steps to Better Understand Your Personal Finances

Funnily enough, November is financial literacy month here in Canada and we have our own definition of what it means to be “financially literate”.  According to the Financial Consumer Agency of Canada (FCAC), financial literacy can be thought of as:

  • The skills and capacity to make informed financial decisions that lead to positive outcomes. The outcomes of our financial decisions are heavily dependent on our behaviours. 
  • An essential skill, like reading and writing. When you are financially literate you will have the ability to adapt or persevere through unpredictable circumstances and difficult times in life.

Essentially, you’ll be able to manage your financial well-being and participate fully in society once you have the know-how, or at least that’s what the Chartered Professional Accountants of Canada (CPA) like to think. So if you’re ready to cozy up and decode what roadblocks might be in the way to better understanding your personal finances, consider putting these 10 steps into action:

Reflect on your relationship with money

Did you experience a lack of it growing up? Do you feel guilty every time you spend? Do you see numbers and automatically want to shut off your brain? That kind of reaction may stem back to some math trauma that you experienced in your early years. 

The point is this: If you want to identify the factors that affect your relationship with money, you’re going to have to be honest with yourself and acknowledge what events have had an impact on it.  

Assess your independence

There are plenty of women who still lean too heavily on a partner or family member for money. That’s just the truth. According to a recent financial independence survey conducted in Canada, nearly three-in-10 (28 per cent) of women are dependent on a partner or someone else to make ends meet financially. The kicker is that 16 per cent of women leave the management of household finances and investments to their partner. 

We all know that the more dependent we are on someone else for financial freedom, the less we’re able to control the type of lifestyle we live. You have to be the one to ask yourself the question: how independent am I and how do I want to live? 

Write down your financial goals

The first thing that may come to mind is that you no longer want to be dependent. Write that down! Want to pay off debt? Mark it on the page. Better yet, dedicate an entire journal to penning your thoughts, feelings and progress with your financial goals. 

Sometimes, having a visual representation of what you want to achieve helps to conceptualize your goals, so get creative and colour code if it helps. Plus, writing everything out will help you remember exactly what you’re setting out to achieve.

Read, read, read

Educate yourself on factors that affect women and their finances in particular. For example, look at retirement costs: women who reach the age of 65 are expected to live more than two years longer than men of the same age. But frighteningly, a 2017 retirement income literacy and gender differences report by the American College of Financial Services found that more than 80 per cent of older women couldn’t pass a retirement financial literacy quiz. 

Unfortunately, we can’t imagine the results would look much different on this side of the border. Needless to say, it’s crucial to understand personal finance concepts in order to prepare for what’s to come.

Analyze your habits during the holidays

A whopping 29 per cent of holiday shoppers who purchased Christmas gifts with their credit cards in 2020 are still paying them off. So, do you want to be one of those people carrying a balance over into 2022? Probably not. Keep that in mind because the holidays will allow you to observe your regular spending habits and this may just uncover stressors in your relationship with money. 

Use a budgeting app

Downloading one that registers all of your transactions may be the easiest way to see where your money is going. Thankfully, Hardbacon offers an app that’s designed specifically for mobile and you can connect and manage all of your accounts through an easy-to-use interface. More than 30,000 Canadians are currently using the Harbacon app to plan, budget and invest for free. What could be better? 

Take advantage of comparison tools.

Seriously, let the technology do the dirty work. When it comes to finding the right financial products for you, like credit cards with low interest rates, utilize the filters on a website like Hardbacon’s to tailor your search. Simply answer a few questions and they’ll find you the best value in the nation after narrowing down their database of over 200 cards.

Seek out free resources

With the growth of social media and content creation from certified financial professionals, there is no shortage of cost-free resources to squeeze online. For example, look at your banking app. The Canadian Bankers Association (CBA) confirms that over 99 per cent of adult Canadians have an account with a financial institution, which means nearly all of us can make use of their in-app features like goal planners and insights. 

If you want to take things one step further you can seek out free courses, ebooks, worksheets, coaching sessions and virtual consultations from professionals.

Listen to podcasts about money and personal finance

This isn’t just a shameless plug. Podcasts and radio shows are also free resources and there are a number of quality programs out there to listen to too. And fortunately for Canadians, most financial advice across provinces, states and even countries can apply to almost anyone. 

Listening to other people talking about money and personal finance not only helps normalize the rhetoric, but tuning in to conversations between real people can help us understand and become more comfortable with financial concepts as if we were breaking them down with a friend. On the plus side, there is an array of topics being discussed, from business to stocks to national news to more personal accounts.  

Get organized

It’s true that “cleaning up” is something a lot of us dread. Sorry (not sorry) to bear the bad news but organizing everything to do with your personal finances is one of the only ways to get ahead. That means sorting through your filing cabinet, updating your calendar with bills due and paydays, creating a plan of action for your goals, streamlining your accounts, making a call or two to your financial advisor, rounding up things you’d like to sell or donate…

If the holiday break gives us a chance to do anything but relax and fill our bellies, it’s a whole lot of time to get things in order for the new year ahead. Think of it as a clean slate because there is never a better moment for you to start improving your financial situation than right now. Contrary to popular belief, it’s never too late either.