
Raising Money-Smart Kids
Start Early and Make It Fun
We all know money is more than just a means of exchange; it’s a life skill that influences our daily decisions and future aspirations.
And with that, financial literacy doesn’t have to wait until high school. Engaging children with age-appropriate activities can make learning about money enjoyable. Start with simple concepts like identifying coins and notes, playing store, or using a piggy bank. These activities lay the foundation for understanding money’s value.
Encourage your kids to save part of their allowance or birthday money. Use clear jars so they can see their savings grow, reinforcing the concept of delayed gratification.
Lead by Example
Children are keen observers and often emulate their parents’ behaviours. Demonstrate sound financial habits in your daily life. Show them how you budget, pay bills, complete your taxes, and make thoughtful purchases. Discuss financial decisions openly, explaining the reasoning behind them. This transparency normalizes financial discussions and presents money management as a positive, responsible activity.
Teach the Importance of Earning
While it’s tempting to give kids money freely, teaching them to earn it fosters a sense of responsibility. Encourage them to take on age-appropriate chores or small jobs for neighbours. Earning their own money instills pride and reinforces the link between work and financial rewards.
Additionally, introduce the concept of entrepreneurial ventures. Whether it’s a lemonade stand or selling homemade crafts, these small businesses can teach valuable lessons about profit, loss, and customer service.
Set Goals Together
Goal-setting is a crucial component of financial planning. Sit down with your children and help them set short-term and long-term financial goals. Whether it’s saving for a toy or college, setting goals teaches the importance of planning and prioritizing. Celebrate their achievements to motivate them further.
Involve Them in Family Finances
Involve your children in age-appropriate family financial discussions. This could be as simple as discussing grocery shopping budgets or planning a family vacation. These activities show them the practical application of financial skills and the importance of budgeting and making informed decisions.
Encourage Questions and Continuous Learning
Foster a safe space for your children to ask questions about money. No question is too small or silly. Continuous learning and open communication are key to demystifying finances and empowering them to make informed decisions.
Introduce Them to Professional Guidance
Involving children in meetings with a financial advisor can be a valuable experience, offering them real-world insights into financial planning and decision-making. As your children grow older, consider including them in these discussions to help them understand the importance of long-term financial strategies. These interactions can lay the groundwork for informed financial decisions and emphasize the benefits of seeking professional advice as they navigate their financial journey.
Available Resources for Parents and Kids
Talk to us about IG Wealth Management’s Empower Your Tomorrow platform. It’s more than just a program; it’s a mission to equip Canadians with the tools, resources and confidence they need to take charge of their financial futures and improve their financial well-being. We believe that financial understanding (coupled with the right resources and skills) empowers young and under-served Canadians to reach their goals and build a healthier, brighter future for themselves, their families and their communities.
Another resource is the Canadian Foundation for Economic Education’s Money and Youth program offers a comprehensive guide to financial literacy for youth and parents. Money and Youth serves as a “Guide to Financial Literacy” for youth ages 14 and up and also serves as a primer for adults, especially parents and teachers who often assume responsibilities for helping children improve their financial capability.
Teaching kids about money is an investment in their future, equipping them with the tools to navigate the complexities of financial independence. By fostering a solid understanding of money management, children can develop confidence, responsibility, and smart decision-making skills that will benefit them throughout their lives. Start the conversation early, lead by example, and empower your kids to take charge of their financial journey—because financial literacy is a gift that keeps on giving.
This is a general source of information only. It is not intended to provide personalized tax, legal or investment advice, and is not intended as a solicitation to purchase securities. Shauna Selig is solely responsible for its content. For more information on this topic or any other financial matter, please contact an IG Wealth Management Advisor.