The subject of money and finances is one of the least discussed topics in the household, according to an Ipsos Reid survey, and that could leave your child struggling to make the right financial decisions later in life.
The survey of teens 10 to 17 years old showed 34 per cent felt there were secrets in the home when it came to money. One in three teens believed their family had money problems.
It also found that a third of the youths wished their parents would talk to them more about family finances.
“A lot of parents are not comfortable talking with their children about finances,” said David Lee of Blue Shore Financial.
Lee says parents should start educating their children about money at around the age of ten. He says the most important lesson is budgeting.
“You can start as easily as using money jars,” he said. “It’s not a natural skill. It has to be taught.”
Sixteen-year-old Katherine Jang started using money jars a long time ago, and now that she’s got a job, she’s learning to save even more.
“If I'm babysitting, I save 10 per cent and then when I receive my cheque from tutoring at a Kumon centre and I save 20 per cent," she said, "My three financial goals are having money for university, having money to spend after university and having money to give to charity,”
“We're not afraid to talk about money, but it doesn't come up often," said Phoebe Yong, Katherine’s mom. "She always talks about money when usually there's big expenses coming up." And Young admits they don't talk a lot about budgeting.
Parents should also talk to their kids about saving for post-secondary education and investing their own money into an RESP.
Some other things you can do with your children to make them more financially savvy include:
- Create a spending plan
- Journal about money; writing down everything they spend
- Save at least 10 per cent of money earned
- Put money towards an RESP
And it might seem odd, but it’s never too early to think about retirement.
"You should start as early as possible," said Lee.
