Canadians look up basic financial terms as advisors work to fill gaps left by schools and misinformation
A lack of financial education is costing the average Canadian household between $1,997 and $5,410 annually, according to a report by BrokerChooser.
The forex broker firm analysed search data across 53 financial terms and found that 64 percent of Canadians did not receive any financial literacy education in school and are now trying to fill the gap on their own.
BrokerChooser’s analysis revealed that “ETF (Exchange Traded Fund)” was the most misunderstood financial term in the country, drawing 11,400 monthly searches in Canada and 142,230 globally.
Head Analyst Adam Nasli explained that an ETF is “a ready-made investment portfolio that trades on the market,” and is often appealing due to its low fees, tax efficiency, and built-in diversification.
ETFs are typically issued by firms such as Vanguard and BlackRock and can track indices like the S&P 500.
Following closely behind, “Equity” ranked second, with 10,600 monthly searches in Canada and 247,100 worldwide.
According to Nasli, equity is widely misinterpreted because it is used in multiple contexts. In real estate, it represents the value of an asset after debt.
In the financial markets, equity refers to company shares, reflecting the owner’s residual interest after liabilities.
The term “GDP (Gross Domestic Product)” placed third with 7,700 monthly Canadian searches. Although frequently mentioned in media coverage, GDP remains a source of confusion.
Nasli explained that GDP measures the total value of goods and services produced in a country during a given period, and is often used alongside other indicators to gauge the health of an economy.
Ranked fourth was “APR (Annual Percentage Rate),” which drew 5,950 monthly searches. Despite appearing on credit agreements, APR continues to perplex many Canadians.
Nasli said it encompasses not just the interest rate but also fees, providing a more comprehensive comparison tool for evaluating borrowing options.
“Yield” ranked fifth, with 4,150 Canadian searches each month. It refers to the income return on an investment from sources such as dividends or interest.
Nasli explained that yield is a key concept in assessing risk and return—higher yields often signal higher risk, while lower yields indicate more stable investments.
Other terms rounding out the top 10 included “Annuity” in sixth place with 3,750 searches, followed by “Correlation” at 3,100, “Arrears” at 2,900, “Principal” at 1,500, and “Capital” at 1,400.
According to Nasli, the rise of AI-powered financial scams has made foundational financial literacy “essential.”
He said that a lack of understanding around common terms like yield, ETF, or equity can lead to costly investment errors and missed opportunities.
“It’s not about becoming an expert overnight, but rather building the foundation needed to make sound decisions, ask the right questions, and stay one step ahead,” he said.
As reported by Bloomberg, Gen Z consumers are participating in spending habits like “doom spending” and are increasingly sceptical of long-term saving.
A May 2025 Credit Karma survey found that 49 percent of Gen Z respondents said saving for the future felt pointless.
Although this generation has widespread access to financial content—from blogs to social media influencers—only 33 percent of them turn to these sources for financial education, according to a Spruce survey.
Bloomberg noted that the volume of conflicting and sometimes misleading information may be contributing to financial misinformation and confusion.
Wealth Professional highlighted several efforts by advisors and institutions to address this gap.
John Bromley, CEO of Charitable Impact, described a “charitable allowance” initiative that allows parents and grandparents to give children money earmarked for donations through donor-advised funds (DAFs).
Bromley said this approach introduces children to values-based decision-making while teaching financial skills like assessing charitable impact and managing funds in a controlled environment.
He added that when these allowances are funded with securities, it offers a learning opportunity in investment decision-making—children can choose to hold, sell, or donate shares.
“It’s a great way to teach the family values component while starting to get them engaged in the more serious financial literacy side of things,” Bromley said.
Cassandra Cross, an advisor at Nicola Wealth, told Wealth Professional that financial literacy is particularly urgent for Canadian women, who are expected to inherit $1tn by 2030.
Cross said she often encounters women experiencing imposter syndrome when engaging with financial topics, and stressed the importance of creating a safe, non-judgemental environment.
She added that cash flow-focused portfolios, insurance planning, and structured gifting strategies—such as intrafamily loans—are key components when working with female clients.
“We recognise that wealth without education is a huge liability,” Cross said, noting that working with entire families allows her to equip both clients and their heirs with the tools needed for responsible stewardship.
