Susan Yellin, Insurance Journal
November 18, 2022 – 2022 started out with a healthy dose of COVID-induced revenge spending, but within a matter of months higher interest rates and inflation had brought many Canadians back to Earth.
Concerned about higher food prices and rising interest rates, many Canadians are now meeting up with their financial advisors to plan in advance and get advice on how to get the most for their money on everything from food shopping to Christmas gifts, says Julie Martini, Vice President of Strategic Engagement at Advocis.
With November being Financial Literacy Month, advisors are noticing that clients are on board with planning in advance, budgeting and looking for sales. “That is definitely a shift we have seen from earlier this year in terms of attitudes toward spending.”
According to a recent Advocis poll, 73 per cent of members said the main measures clients are using to cope with inflation is to cut back on buying food, clothing and general impulse items where possible. About 40 per cent said clients were shopping more frequently at discount stores and buying unbranded items.
Martini said the financial situation just shows how important it is to have knowledgeable advisors provide that essential guidance all year round.
“That ‘do-it-yourself attitude’ is scary when times are tough,” she said. “Having that reassuring presence of an advisor really demonstrates the value that advisors can bring.”
While this is Financial Literacy Month, most advisors provide guidance all year long for their clients, and see helping educate their clients as part of their job, she said.
“Basic understanding of things like budgeting and insurance, investments, taxes and death, etc. is so important when it comes to improving the quality of our lives,” said Martini. “I think we all know we have a long way to go on that front in terms of making this an [essential] part of the knowledge we grow up with, but this is a very good start” in terms of providing people with expert guidance, encouragement, support and peace of mind.
And it’s not just adults that require financial literacy knowledge, said Martini. She noted that when it comes to children, it’s crucial to make financial literacy a part of their lives because of how they handle financial issues in the future.
Last year, Advocis developed a platform on how to support life goals from primary school onwards called financialadviceforall.com, or FAFA – basically a junior financial advisor kit with a book to help children understand money. Martini said the platform has been used by parents, teachers and even advisors, to the point where a teen edition is now available. Content comes from a variety of Canadian financial organizations.
“It’s getting a lot of pick up from our members who are using it with their clients. Teachers are using it. it’s also about making financial literacy fun and interesting and leaving them with tools and knowledge they can walk away with.”
Advocis has also created a financial literacy game called Roadblock, an obstacle-like board game in that kids can only move forward if they have answered a question correctly.
Advocis also taps into advisors who write about the topics they feel are most important to consumers.