Teens think they'll earn $90,000 a year by age 30

A recent CIBC surveyed showed that many Canadians have unrealistic expectations when it comes to getting out of debt.  It seems that recent high school graduates also have some pretty wild expectations.

The National Report Card on Youth Financial Literacy, released this week by the British Columbia Securities Commission, surveyed over 3,000 recent Canadian high school graduates, most of whom went on to a post-secondary program.

It found that:

•  On average, they expect to be earning nearly $91,000 annually 10 years from now –  that’s roughly three times the average income of 25 to 29 years-olds with post-secondary degrees, according to 2006 Census data from Statistics Canada.
• Nearly three-quarters expect to own a home in the next 10 years. According to estimates from Statistics Canada, only about 42 per cent of 25 to 29-year-olds are homeowners.
•    Almost half of those with a student loan say they plan to have it paid off in five years. But student debt has reached a record high of $15 billion, according to figures from the federal government.

 Why the disconnect? It probably has a lot to do with this: less than half of high school graduates recall taking a course that covered topics in personal finance.

In 2004, students in British Columbia began taking a quality, comprehensive course called The City, and students from this province scored higher than the national average on the financial literacy report card.

This resource is now available in all provinces and territories through the Financial Consumer Agency of Canada.

That’s a great first step, but the federal government needs to do more. Federal Finance Minister Jim Flaherty championed the cause by setting up a national task force which delivered 30 recommendations earlier this year. But since then not much as been done.

A coalition of groups dedicated to financial literacy held a press conference earlier this week to herald the kickoff of Financial Literacy Week.

Flaherty was there, as well as Donald Stewart, chief executive officer of Sun Life Financial Inc., who chaired the task force.

But there was no mention of a long-promised Financial Literacy Czar who would be responsible for implementing the group’s recommendations.

So what are we waiting for?

Also read:

Debt-free by 44? Many young Canadians think so