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How to Empower Girls to Manage Money and Avoid Personal Debt

The world celebrated International Women’s Day on March 8, but when it comes to finances, there’s still a gap between Canadian women and men, and that includes the level of personal debt they carry.

We know, from our most recent polling, that women are more likely than men to carry heavier debt and struggle with affordability. As we approach 2020, there’s even more push to close the gap and empower young women by teaching them financial literacy so they can manage their money and avoid personal debt as adults.

There is good news. In its report, The Economic Well-Being of Women in Canada, Statistics Canada reported that women’s financial contributions to family income have significantly increased over the past five decades. In families where the core working ages are 25 to 34, women’s earnings accounted for 46.7 per cent of the family’s income in 2015 — an increase of 22.2 per cent since 1976.

But Statistics Canada also reported that, on average, women still have lower financial literacy scores than men and are less likely to feel financially confident. This is concerning because people with less financial knowledge tend to borrow more, carry excessive debt loads and accumulate less wealth.

Closing the debt, affordability and financial literacy gap

Gen X moms can help their daughters by ensuring they have the knowledge to effectively manage their finances as adults. Generation X currently carries the most personal debt of all generations, so focusing on educating their daughters might also help moms improve their own financial situations.

Here are five ways you can help your daughters prepare for a bright financial future:

  1. Teach them how to handle money on a monthly basis. Most adults get paid bi-weekly or monthly. To ensure we can make ends meet, we have to plan how we are going to use our income or we end up taking on debt. Show your daughter how to use a monthly budget, track spending and identify needs versus wants.
  2. Explain how credit works. People who lack financial literacy may view credit the same way they view cash. But with interest rates as high as 20 per cent, credit card debt adds up and can quickly spiral out of control. Teach your daughter the pitfalls of using credit, but also discuss how she can use credit to create a good credit rating, which will allow her to borrow funds when she needs it in the future, such as for school, or to buy a house, or start a business.
  3. Make saving automatic. Most people only contribute what’s leftover at the end of the month toward savings. That’s backwards and usually fails to generate any significant money. Talk about the importance of having an emergency fund and saving for retirement. Help her open a savings account and set up automatic payments (from her allowance or part-time job) to savings. Encourage her to set savings goals for both the short and long term.
  4. Go beyond the basics. Teach your daughter how to build wealth so they can achieve financial independence and avoid debt. Help them learn about financial planning, investing their savings and asset allocation.

Helen explains the basic rules for financial independence at Golden Girl Finance.

  1. Talk about getting help early. Nobody’s perfect. Explain how getting help if she finds herself carrying a little personal debt will prevent that debt from snowballing. Introduce her to non-profit credit counselling, or explain the benefits of meeting with a Licensed Insolvency Trustee (LIT), where she can find help and learn about debt options in a non-judgemental setting.


Given the knowledge and skills to manage her money and use credit wisely, your daughter can have a successful financial future. Educate her on financial literacy and you’ll help her avoid personal debt.

What are you doing to help your daughter prepare for a financially successful future? Tell us your story on Twitter. #LeaveDebtBehind #WomenAndMoney #BalanceforBetter

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