Valley First

Financial Literacy Increasingly Important

Financial literacy increasingly important as potential youth spending power grows
June 4, 2013

Penticton, B.C.—A recent report suggests the spending power of young people will grow steadily over their lifetimes, eventually outpacing the comparative spending power enjoyed by their parents.

While youth and young adults are often the hardest hit during economic downturns—largely due to fewer job prospects, higher unemployment and slower wage growth—growth trends indicate there will be light at the end of the tunnel.

“Recent history tells us each generation has enjoyed comparatively greater spending power than the generation before them,” says Marion Henselwood, a branch manager at Valley First. “This is good news for the many young people who are trying to financially establish themselves in our sluggish economy.”

Given the potential to earn more and eventually have greater spending power than their parents, Henselwood firmly believes young adults should establish good financial habits as early as possible.

“Most of us will go through a period in our lives when we’re living pay cheque to pay cheque,” says Henselwood. “This can be educational in itself. However, once the bank account starts to look a little healthier, it’s important to break the habit of spending everything you earn every week. This is where financial literacy and good money management come in.”

Henselwood advises her members to regularly assess their financial priorities and then develop a plan for how to reach them. For many young people, top financial priorities are paying for school or buying a vehicle. As they get older this shifts to home-buying, investing and saving for retirement.

“The first step to reaching a financial goal is to establish a solid financial routine,” says Henselwood. “Something as simple as putting away a small amount into an RRSP or tax-free savings account when you’re young can translate into good saving behaviour and really pay off as you get older and have more investable income.”

About Valley First

Valley First is a division of First West Credit Union, B.C.'s third-largest credit union, which has 40 branches and 29 insurance offices throughout the Lower Mainland, Fraser Valley, Kitimat and Okanagan, Similkameen and Thompson valleys. Led by Launi Skinner, First West has $7.1 billion in assets under administration, more than 171,000 members and close to 1,300 employees.

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