Tip: Mydoh’s savings budget calculator helps kids and teens see where their money is going and how much they can save. For teens who are contemplating their first job or starting their career and entering the workforce, information on how much you earn and how much it costs to run a household can help them make informed choices and entrench good money habits early. Younger kids begin to understand that it costs a certain amount of money each month to live. When they know the real costs of living, it’s easier for kids to understand why you don’t order pizza every evening or why there’s no money in the budget to buy that $200 pair of sneakers.Īnd when kids have a sense of just how much cash goes to running a household every month, then how much you earn begins to make more sense. These conversations are tangible ways to help kids learn the difference between wants and needs. Another important lesson is talking about saving for retirement or post-secondary education. You can also talk about how much you spend on groceries, gas, and insurance for the car, as well as expenses like medications and clothing. Discuss rent or mortgage payments and let them know how much it costs - literally - to keep a roof over their heads. You can show your kids the monthly bills for electricity, water, heat, property taxes, and home insurance, and they can tally up the amounts. Take a little tour of the house and talk about what it costs to keep it running. Instead, start with what’s most familiar to kids: their home. In fact, telling your five-year-old how much you earn could be counterproductive most elementary school kids won’t get the difference between $1,000 and $100,000. We’re not suggesting that parents have to break out tax returns and pay stubs in order to talk about household finances. Teaching kids about good money habits starts at home Learn more: How Canadians teach their kids about money. So, we owe it to our kids (pun intended) to help them develop smart money habits and set them up for a healthy financial future. In fact, according to Credit Canada, the average Canadian household debt has increased four times in 30 years: we now owe $1.78 for every dollar earned. Having honest conversations about money is even more important when you consider that Canadians today are carrying record amounts of debt. And it’s hard to form good money habits with those beliefs. If we don’t talk about money, we’re sending the message to our kids that money is something mysterious, shameful, or even scary. We feel that we don’t know enough about money or personal finance to teach our kids about it, or we’re worried we’re not good role models when it comes to spending and saving - and that our kids will find out about, or, worse, emulate our less-than-ideal money habits.īut if we want our kids to develop good money habits, parents need to get comfortable with talking to them about things like spending, saving, debt, and investing. We don’t want our kids to worry about money, or we think they may tell the neighbours how much we make. We feel squeamish talking about money for a number of reasons. In a 2019 survey, 25 per cent of parents were either very or extremely reluctant to talk about financial topics with their kids, and another 25 per cent classified themselves as “somewhat reluctant.” Why is teaching kids good money habits important?įor some parents, that question is scarier than any inquiry about the birds and the bees.
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