Being raised by Greek immigrant parents, I learned at a very young age the value of a dollar. I remember how hard my parents worked to earn, and more importantly, save their money.

Now having children of my own, I know the importance of teaching my children about money, and the value of money.

But money is still considered a taboo topic by one quarter (27 per cent) of parents! Only one-third (33 per cent) of Canadian parents first talked to their children about money management before they turned 10 years old. That number seems low, doesn’t it?

It’s never too early to talk to your children about money and financial responsibility. Start as soon as they’re able to count and make money the topic of regular family discussions. Who better than parents to start the money management conversation to help their children develop smart money skills that can set them up for a more secure financial future?

With more young adults finishing post-secondary education with huge student loans, or saving up to buy a new car or house, it’s important to teach kids about spending, saving and personal finance.

Compared to our own parents, today expenses seem to be at an all-time high. Children see their parents opening their wallets more often, but they also need to realize money doesn’t grow on trees! Far too often I see parents giving their kids everything they ask for – don’t feel guilty about saying no!

This is the perfect chance to teach them the difference between needs and wants, and that they may have to wait to buy something they want. This will help encourage them to budget and save their money, make sensible spending decisions. They’ll feel the joy and sense of reward when the money they’ve saved can finally be used on an item they’ve been wanting to purchase.

For Financial Literacy Month this November, Paul Orlander, Senior Vice President of Personal Savings and Investing at TD Canada Trust, and co-chair of TD’s Financial Education Council, offers the below guidelines to help parents tailor money lessons to each child’s age and developmental stage.

Teaching Kids About Money by Age

Teaching Kids About Money by Age | AMOTHERWORLD

Under 6 years old

At this stage, children are interested in the different shapes and colours of money. Handling real money can help them learn more about it. So, give your child some shiny coins they can put in a jar or piggy bank to watch their savings grow. Although preschoolers may be too young to understand the concept of money, they are learning to count, and have a basic knowledge of quantities. Make the experience of adding to the jar a big deal and as the number of coins grows, swap them occasionally for the equivalent amount in crisp bills.

6 to 9 years old

Generally, seven- and eight-year-olds understand the concept of saving, but they might not yet understand what’s fully involved in paying for all the latest and greatest toys they want. The balance of saving and spending can be reinforced by giving your children a small allowance, perhaps earned through set chores, explaining to them how long it will take to buy something they really want. Children at this age have usually grasped basic math skills like addition and subtraction, which can help them learn the value of money.

10 to 15 years old

Teach pre-teens how to use their bank account, such as making deposits and withdrawals, and responsibly use a debit card. They might start to earn their own money through odd jobs or babysitting, so now might be time to ask them to cover some of their own expenses. Teens are often developing their plans for the future – looking ahead to college, university or a big trip – so it’s a perfect time to introduce them to the concept of setting financial goals and investing early to take advantage of compound interest. It is also important to teach teens about the importance of credit and how a credit card works.

16 to 18 years old

Your child may be less financially dependent on you now, especially as they start earning more money through a part-time or summer job. They also may be taking on more responsibility to pay for regular bills, such as monthly mobile payments, and saving for bigger purchases, such as a car. Sharing the family budget will help your teen learn about real-world costs and keep their expectations in line with your family’s financial reality. Furthermore, sit down with your child and help them set up their own budget tracker, so they too can track where their money is going and how to set spending priorities. Saving for retirement early and for a rainy day are other topics of discussion to consider having at this age.

 

Check out TD’s Smart Money Toolkit  for more tips and resources to help them educate their children on smart money management practices!

 

Disclosure: This post is proudly sponsored by TD Canada Trust. As always, the opinions expressed herein are my own.

Author

Maria Lianos-Carbone is the author of “Oh Baby! A Mom’s Self-Care Survival Guide for the First Year”, and publisher of amotherworld.com, a leading lifestyle blog for women.

11 Comments

  1. I really wish they made personal finance classes a mandatory at college. It would be so helpful in ensuring kids are prepared for the real world once they are done with school.

  2. It so important at their early ages, they know to earn and how to save it for all purposes. This would be so helpful and prepared for all purposes.

  3. Kelly Reci Reply

    How smart this guidelines by ages,for ensuring and educating them how to save and give importance to money.. Such a great read.

  4. Oh, this is s a wonderful post. We should teach them and this guideline is so helpful.

  5. These are really great tips. I thought my son was too young, but you are so right about getting them interested early. My son loves the look and feel of coins, so we are going to start right there!! Thank you!!

  6. Thanks for this tips. Now I know what to teach my kiddos at their age.

  7. My son is 9. He fits in the 6-9 category as you described it perfectly!

  8. Christina Aliperti Reply

    This is great. I think it’s never too early to teach kids about money and you broke it down perfectly.

  9. Elizabeth O. Reply

    It’s important to start them early with saving because that’s a skill they’ll be able to take advantage of when they’re older. This will serve as a good guideline for parents!

  10. CourtneyLynne Reply

    Great tips!!!! Teaching b kids about money and be tough.

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