Family Life


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Why raising the next generation of money-conscious kids is a top priority

According to BMO Bank of Montreal’s most recent financial literacy report-card, more Canadians would rather talk to their kids about the facts of life than they would their finances. Not surprising, given the numerous financial-handling tools, strategies and institutions offered to Canadians today.

When it comes to broaching the topic of money with kids, “the earlier the better,” says Kelly Harper of BMO Financial Group’s Institute for Learning. Talking money with kids should be an ongoing process, she adds, noting the complexity of the topic.

With myriad financial considerations affecting the lives of Canadians, ensuring that we bring up our kids with the necessary level of financial literacy – the knowledge, skills and confidence to make responsible financial decisions – is absolutely essential. With that goal in mind, this November marks the fourth year that the Canadian Foundation for Economic Education (CFEE) and BMO Financial Group have partnered to bring financial literacy programs to the home and the classroom in an effort to start a conversation around money and keep it going.

The federal government is taking notice too. In fact, this past April, Minister of State (Finance) Kevin Sorenson announced the appointment of Jane Rooney as Canada’s first-ever Financial Literacy Leader.

As Canada enters its fourth annual Financial Literacy Month, Kelly offers the following tips for parents to start a meaningful discussion with their youth about money:

  1. Take advantage of resources – Educate your kids by first educating yourself.  Speak to your financial adviser and visit to find a range of ideas and activities.
  2. Take the pressure off – No one expects you to be an expert. Don’t’ be afraid to share mistakes you might have made or things you wish you had known earlier in life.  Incorporating and discussing finances into everyday activities makes the topic less taboo.
  3. Speak their language – Use concrete but relatable terms for youth. A 12 year-old might not understand complex investing strategies, but they’ll absolutely understand how to create a weekly budget using their allowance.
  4. Keep it interactive – Involve kids in activities that make finances tactile, in interactive ways – don’t think of it a ”lesson”. Do grocery shopping together, explain how gas and hydro bills are calculated and, when age appropriate, bring them into the family budget planning process.
  5. Make it hands-on – Before hitting the grocery store, ask kids to develop a menu for the week with some of their favourite dinners. Together calculate the cost per each recipe and find some ways to bring the costs down.
  6. Be Proactive – For high school students, get them to prepare a budget for how much they think they’ll need to spend on prom (the tux, the dress, the hair, the car – it can get expensive) and open up an account for them to make monthly contributions to reach their budget goal.
  7. Focus on value – For tweens, try to establish needs versus wants. When there is a new pair of shoes or a toy that they simply must have, create a rule that the older version gets donated to a local charity. This will help show the value of (and hopefully facilitate an appreciation for) new things.

The earlier we familiarize the next generation with financial planning concepts, the more equipped they will be to face important financial decisions, budget, handle debt, save for their education – and maybe ask their parents for less cash along the way.

a man carrying two children

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