Kids & Money

Apr 12, 2012 by

Kids & Money

Teach Your Children About Money Before They Leave Home

Guest post by Canadian Budget Binder

Do you have a friend who lived at home into their 20s after post secondary and their parents never wanted any rent money?

Were you jealous because you had to work and pay rent to your parents?  When you moved out I’m betting you had a better understanding about paying rent and bills on your own potentially saving you from becoming a statistic of debt in Canada.

It doesn’t matter if your children are 5 or 25 – teaching them about money is better later than never. I suggest teaching them when they understand numbers and how to count… little by little you can guide them into what to expect in the real world. We tell them no at the candy shop but do they understand why? It’s not always about their teeth or they will ruin their dinner.

Tell them the truth.. you don’t want to pay for it neither and tell them why.

Top Ideas To Teach Your Children About Saving and Money

  • Saving for a rainy day- what is Emergency Savings?
  • Saving to pay off debts- what is a Debt? Why should you avoid Debt if possible?
  • Saving for Education- Not all parents open RESP’s so teaching children about saving for school is      imperative.
  • Bank accounts- types of accounts and what happens with a bank account, why we need them.
  • Tax- Why do we pay tax? How much tax is calculated and on what items?
  • Credit Cards- What are credit cards? When should we use them? When should we not use them? Interest      rates?
  • TFSA- What is a TFSA and when can they start putting money away?
  • Temptation- The Difference between a “Need” and a “Want”
  • What happens when you don’t pay your bills
  • What is bankruptcy?
  • What is a credit check?
  • Why they should stay away from “Pay Day Loans”
  • What is keeping up with the Jones and why they shouldn’t
  • How to grocery shop using coupons and looking for deals, sales, flyers
  • How to make a budget for university, college or while they live at home
  • Why it’s important to save a portion of their pay for the future if they work while in school
  • If they see money on the ground to pick it up
  • Don’t be afraid to ask for assistance if they don’t understand
  • Research what you plan to purchase
  • Impulse shopping -what is it? Why they should avoid it?

This list could go on and on, but you get the picture. Of course there are different stages in life when we teach our children about money. You aren’t going to teach your five-year-old how to save for a down payment on a house rather why it’s important to save part of their birthday money for a need rather than a want.

When parents budget to give their children an allowance they should tie that allowance to chores around the house or even walking the family pet. When children are just handed money they don’t learn a sense of responsibility rather you teach them that they are entitled. This can turn into ‘desires’ when they get older which could cause them to spend without consequence until it’s too late.

A great way to teach younger children about money is to have them get a job as a paper carrier or insert delivery boy/girl. These jobs are relatively easy with no payments being sought as it is either a free home delivery or payment is through the newspaper.

A babysitting job is just as common today as it was when we were young in the 80s. Encourage your children to seek out these life experiences as they look good on a resume when seeking out their first real employment opportunity.

Children can learn:

  • time management skills
  • interpersonal skills
  • responsibility for actions
  • knowledge that money is not free you need to work to get paid
  • ability to work on their own or in a team
  • how to problem solve and brainstorm
  • how to save money

Parents Need To Lead by Example!

If parents lead the way for their children they will thank them one day when they are old enough. If you feel you are not educated enough you can easily contact any financial institution or advisor who would gladly sit down with you and your child to explain money and saving. That’s a great time to learn along with your children to show them you are interested in their future. Children seem much more involved when you turn something into a learning excursion all about them.

You can read some other great tips in this article about Teaching Children about Money.

About Canadian Budget Binder
We’re your average married Canadian couple in our 30′s budgeting to live a comfortable life. Join me, Mr.CBB as I blog about our actual Canadian Budget, Net Worth, Monthly Grocery Challenge,Money Saving Tips, Deals, Frugal Recipes and more. Visit CanadianBudgetBinder to learn about budgeting, finance, frugal tips, recipes and more!

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23 Comments

  1. Nicola Don

    Mr CBB sent me. I always had to save for stuff with my pocket money and then worked when I was old enough to get extra cash. My kids are now asking when they can get stuff and we have both told them if you do chores round the house then we can give you pocket money to save for things you want yes always start early.

  2. Sandy Davis

    Great post and such an important topic! I wish my parents had talked about money but my parents generation never discussed finances..it was “none of our business” When I grew up I couldn’t understand why I couldn’t just go out and buy whatever I wanted because that is what it seemed like my parents did. Letting kids know you work and save for things is a really important lesson. Mr. CBB at Canadian Buget Binder suggested this link. Have a great day :)

  3. Zayba

    Very good article :) Mr. CBB sent me!!!!

  4. Wendy LeDrew

    Great article! I enjoyed reading it:) It taught me that it doesn’t matter the age of your children, its never to young to teach them the importance of money and saving. Mr. CBB sent me!

  5. Joanna Cheevers

    Thanks for sharing this post. I am a fan of Mr CBB’s and was lead here through a post on his facebook page. As with his other posts on his blog, I found this one to be quite informative and glad it led me to your site. Being a mom of a 6 year old your site looks to hold a lot of helpful information. Looking forward to going through other posts on your site and learning more about your book. As Mr. CBB would say, Cheers!

  6. Linda Leroux

    Great article Mr. CBB! Thanks MoneySmartMom! Mr.CBB sent me!

  7. Jen P

    Mr CBB sent me! Great article! I will have to save this so I know what to teach my little guy! I wish that my parents had taught me some of this stuff before it was too late! I think too many kids these days get things handed to them and they need to learn the value of a dollar and working for it.

  8. Kelly Babineau

    Sent by Mr. CBB! Teaching kids to budget their money is an important part of growing up.

  9. Vendia Carvery

    Hi Sarah,
    Mr.CBB sent me.

  10. kathy downey

    Love the Kids & Money,my kids are on their own, trying to teach my grandchldren now.love the story !

  11. Lisa Trommeshauser

    Mr.CBB sent me – great article

  12. Michelle G

    Mr.CBB sent me! Thanks for a great blog, I have added you to my list of must-reads, and bookmarked you. So many people want to save money, it’s hard to get started sometimes.

  13. Shellie Cadogan

    Awesome post…going to share with the kidlets

  14. Allana

    It really was an amazing article, every month my little girl saves all of our change and money from recycling she saves it all up and i get her to spent it on things that she really wants like vegetable and flower seeds, instead of junk that just ends up back in recycling ..i really like this site and ive learned alot..I really want her to do well after leaving the nest so many kids these days just are completely clueless and have no clue what it really takes to survive especially with todays rising costs of food and basic necessities..

  15. Charlene Vidal

    Mr CBB Sent me. Great article.

  16. Suzanne Ouellet

    Mr.CBB sent me

  17. Vicki

    I agree witt this totally my parents never really taught me how to manage money and I’m still trying and also trying to teach my boys about money and how to save it for the things they want to do in the future.

  18. Liz

    Great article and definitely something to think about. Thanks for the good read :D

  19. Liz Draper

    Great article and definitely something to think about. Thanks for the good read! Mr.CBB sent me here originally but will definitely be checking back on my own :D

  20. Cindy

    There is so many things to think about. We have started bank accounts for our kids, as well as RESP’s and even though they are young we tell them about it. Whenever they ask for things that are not needed we ask them do you want to pay for it. Slowly we are teaching them things that we learned the hard way! Thank you for reminding me about all the other things!

  21. Kirsty Louise

    Mr. CBB sent me! Thanks for the great article. I’m glad my parents taught me the value of money at a young age by giving me chores to do to earn my allowance, and encouraging me to get a babysitting job once I was old enough. It helps to have those values instilled at a young age.

  22. Awsome article Mr.CBB !! Another very imformative blog, from your collection of valuable tips .We have already begun the lessons of earning an allowance in our home. I never had such a lesson growing up, so I depend on information such as yours..Thank you. Sent by Mr.CBB

  23. Angie Hall

    MR.CBB sent me.I wish I had taught my kids at an early age what the value of money is!!!

Trackbacks/Pingbacks

  1. Book Review-Money Smart Mom-Financially Fit Parenting « Canadian Budget Binder - [...] Teach Your Children About Money Before They Leave Home (Money Smart Mom) [...]
  2. Should Parents Teach their Children about Money? « Canadian Budget Binder - [...] You can read some other great tips in this guest post I wrote for Money Smart Mom about Teaching ...

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