Canadians think they are more financially literate than they really are, according to a new report from BMO Financial Group.
The third annual BMO Financial Literacy Report Card found that 90 per cent of Canadians give their financial knowledge a passing grade.
But when tested, more than a third who said they deserve an 'A' actually flunked.
The survey of 1,215 Canadians — conducted by Pollara between Oct. 11 and Oct.16 — revealed most people lack basic knowledge of such things as RRSPs and GICs and know practically nothing about more complex investment products.
BMO area manager Michelle Mobarrez said the results show that many people are not as secure as they think they are.
“Unfounded confidence on where their retirement planning might be. Even to say, you know, we have aspirations to upgrade our home, we thought that we were in a better position than we are. So, it can really impact somebody realizing on their dreams and goals."
Albertans had the highest scores in the country, which didn’t surprise Mobarrez.
"Alberta is a hot economy. We have a lot of young, innovative talent here. A very well educated group, with high incomes,” she said.
Carolyn Davis, who speaks for Momentum, a Calgary charity providing free financial literacy classes, said the complexities of money are overwhelming for some people.
"One of the barriers for people is that those first three steps — the budget, the debts under control, and the emergency fund — aren't in place for everyone. And so it can be challenging to think 'where do I start,'" she said.