Starting young is best when teaching kids money management

Developing strong money management skills should be among the most important for helping your kids achieve their life goals

Kids today gain levels of sophistication and tech savviness at earlier ages than ever before.

But this is a complex world and, more than ever, parents have a key role in making sure their children are equipped to deal with every complexity — and developing strong money management skills should be among the most important for helping your kids achieve their life goals, lead a better life and help others.

New research reveals that Canadian parents are very proactive when it comes to teaching their children about personal finance — with 82 per cent of parents frequently or sometimes having conversations with their kids about good money habits. It’s important to start dollars and sense talks early so here are some age-related tips to get you going.

• 6-12 years. Start with a ‘fun’ bank they can fill with coins; eventually graduate to a ‘real’ bank account and an allowance tied to certain tasks to learn responsibility. A fixed amount allowance is best because it teaches that there are serious choices to be made about spending and saving.

Deposit at least 10 per cent of their allowance in a bank account and explain how interest makes their money grow. Board games like Monopoly and interactive websites such as the Canadian Foundation for Economic Education are also great money education tools.

• 12-16 years. Develop a simple budget that includes keeping tax receipts and statements to keep track of their money.

A charitable giving component will show them how their money can have a positive impact on the community. Give an allowance ‘bonus’ for special work with the requirement that the extra money must be invested. Introduce the concepts of ‘compounding’ and tax-saving through such long-term investments as a RRSP eligible investment.

• 16-18 years. Have each child file a tax return as soon as they have a job that results in a T4. It’ll give them a more ‘personal view of taxes and build up future contribution RRSP room.

Co-sign for a low-limit credit card and carefully monitor its use. Stress the importance of making monthly credit card payments to maintain a good credit rating and avoid high interest rates or late fees. Use credit card statements to discuss spending patterns and best use of purchasing power.

More tips:

• Involve you kids in family financial discussions.

• Show how your family budget must balance expenses and income.

• You can even start playing ‘money games’ with your kids as young as two years old.

Teaching kids about money is just plain smart. If you want to add a professional perspective, give your financial adviser a call.

J. Kevin Dobbelsteyn is a certified financial planner with Investors Group Financial Services Inc. His column appears every Wednesday.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

A West Vancouver developer has applied to the City of Courtenay to construct a 39-unit strata development at 2650 Copperfield Rd. Scott Stanfield photo Scott Stanfield photo
Courtenay council gives second reading to contentious development proposal

A West Vancouver developer has applied to the City of Courtenay to construct a 39-unit strata development at 2650 Copperfield Rd. Scott Stanfield photo Scott Stanfield photo

Following a one-year pause due to the pandemic, the Snowbirds were back in the skies over the Comox Valley Wednesday (May 5) morning. Photo by Erin Haluschak
Video: Snowbirds hold first training session in Comox Valley in more than 2 years

The team will conduct their training from May 4 to 26 in the area

Some of the affidavits filed come from family members of Casa Loma and Comox Valley Seniors Village residents in Courtenay. Record file photo
Courtenay seniors’ homes included in class action suit

Plaintiffs in early stage of applying for class certification on suit

Untreated gypsy moth populations can cause significant damage to forests, farms, orchards and urban trees. File photo
Aerial gypsy moth control spraying scheduled for Courtenay

The aerial-spray treatments to prevent gypsy moth infestations are scheduled for the… Continue reading

MARS can now offer private spaces for its orphaned fawns. Photo by Pearl MacKenzie.
Housing natural enemies a challenge for Merville’s Mountainaire Avian Rescue Society

Jane Sproull Thomson Special to Black Press If you’ve ever had a… Continue reading

Jose Marchand prepares Pfizer COVID-19 vaccination doses at a mobile clinic for members of First Nations and their partners, in Montreal, Friday, April 30, 2021. The National Advisory Committee on Immunization is coming under fire after contradicting the advice Canadians have been receiving for weeks to take the first vaccine against COVID-19 that they’re offered. THE CANADIAN PRESS/Ryan Remiorz
Trudeau says he is glad he got AstraZeneca, vaccines are only way out of pandemic

‘The most important thing is to get vaccinated with the first vaccine offered to you’

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

The following is a list of restaurants offering take-out and patio dining. ADOBE STOCK IMAGE
List of Comox Valley restaurants offering take-out, patio dining options

Restaurants in the Comox Valley continue to adapt to government-imposed restrictions in… Continue reading

B.C.’s provincial health officer, Dr. Bonnie Henry. THE CANADIAN PRESS/Jonathan Hayward
Dip in COVID-19 cases with 572 newly announced in B.C.

No new deaths have been reported but hospitalized patients are up to 481, with 161 being treated in intensive care

Protesters attempt to stop clear-cutting of old-growth trees in Fairy Creek near Port Renfrew. (Will O���Connell photo)
Clash between loggers, activists halts forestry operations over Fairy Creek

Forest license holders asking for independent investigation into incident

The courthouse in Nanaimo, B.C. (News Bulletin file)
Island man sentenced in Nanaimo after causing a dog unnecessary pain and suffering

Kiefer Tyson Giroux, 26, of Nanoose Bay, given six-month sentence

Solar panels on a parking garage at the University of B.C. will be used to separate water into oxygen and hydrogen, the latter captured to supply a vehicle filling station. (UBC video)
UBC parkade project to use solar energy for hydrogen vehicles

Demonstration project gets $5.6M in low-carbon fuel credits

FILE – A student arrives at school as teachers dressed in red participate in a solidarity march to raise awareness about cases of COVID-19 at Ecole Woodward Hill Elementary School, in Surrey, B.C., on Tuesday, February 23, 2021. THE CANADIAN PRESS/Darryl Dyck
B.C. ‘should be able to’ offer 1st dose of COVID vaccine to kids 12+ by end of June: Henry

Health Canada authorized the vaccine for younger teens this morning

Most Read