Financial Literacy in Canada

• Author: Anita Indira Anand
• Pages: 170-177

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Financial Literacy in Canada

The Importance of Financial Literacy

As argued in previous chapters, the concept of caveat emptor, or “buyer

beware,” is not a sound basis for policy in our capital markets. We

cannot leave investors to fend for themselves in an incredibly com-

plex nancial marketplace. Rather, regulators and policy-makers

have distinct roles to play in protecting Canadian investors. Whether

we are talking about nancial advisers’ duties to their clients or

white-collar criminal enforcement, investors should be assured of

eective protection as they participate in the capital markets.

That said, investors also have a role to play in protecting them-

selves. Whatever protection securities regulators are able to oer,

investors themselves will always carry the responsibility of choos-

ing what to do with their money. For this reason, it is extremely

important that investors understand what they are getting them-

selves into when they purchase nancial products. Without a basic

understanding of the capital markets, the risks inherent in investing

are vastly increased.

Unfortunately, the Canadian public is oen unaware of all the

economic mechanisms underlying investing and the associated

risks. Unless they have taken courses in economics or accounting,

young Canadians oen enter the workplace and the marketplace ill-

equipped to understand decisions that are essential to their survival

in our economy. Many Canadians learn what a mortgage is while they