How to Teach Kids About Money: Tips and Strategies for Canadian Parents

Teaching kids about money is an important responsibility of parents. By helping your child understand the value of money and the importance of saving, you can set them up for a lifetime of financial success. In this blog post, I’ll discuss some tips and strategies Canadian parents can use to teach their kids about money.

Start early

It’s never too early to start teaching kids about money. Even preschoolers can learn basic concepts such as counting and identifying coins and bills. As your child grows older, you can gradually introduce more complex financial concepts such as budgeting and investing.

Here are some examples of financial concepts and activities for children of different age groups:

Preschoolers:

• Counting coins and bills
• Sorting coins by size and color
• Identifying different denominations of coins and bills
• Playing “store” and “restaurant” games with pretend money
• Reading books about money and finances, such as “The Berenstain Bears’ Trouble with Money” or “Curious George Saves His Pennies”

Elementary school children:

• Creating a basic budget for allowance or money received from chores
• Discussing the concept of saving and setting savings goals
• Playing games that teach financial literacy, such as Monopoly or The Game of Life
• Introducing the concept of interest and how it can grow money over time
• Talking about wants versus needs and making choices about spending

Middle and high school students:

• Discussing the importance of credit scores and credit card usage
• Exploring different types of investments and their risks and benefits
• Setting financial goals for short-term and long-term needs
• Learning about taxes and how to file them
• Practicing real-life scenarios, such as creating a budget for college or buying a car

Remember, these are just a few examples and you can tailor them to your child’s individual needs and interests. By starting early and introducing financial concepts in a fun and engaging way, you can help your child develop healthy financial habits that will serve them well throughout their lives.

Use real-life examples

One of the best ways to teach kids about money is to use real-life examples. Take your child grocery shopping and let them help you compare prices and find deals. Give them an allowance and help them create a budget. Teach them how to save money by setting goals, such as saving for a new toy or a trip to the amusement park.

Examples of activities you can do with their kids:

1. Grocery shopping: Take your child grocery shopping and show them how to compare prices and find deals. Let them help you make a shopping list and use a calculator to add up the cost of the items.
2. Allowance: Give your child an allowance and help them create a budget. Encourage them to save a portion of their allowance each week.
3. Savings goals: Help your child set savings goals, such as saving for a new toy or a trip to the amusement park. Encourage them to track their progress and celebrate when they reach their goal.
4. Garage sale: Have a garage sale and let your child help you price items and handle transactions. This can teach them about the value of items and the importance of negotiation.
5. Lemonade stand: Help your child set up a lemonade stand and teach them about pricing and profit. They can learn about the costs of ingredients and the importance of marketing.

Allowances

Allowances are a great way to teach kids about money management, but tracking allowance payments and spending can be challenging for parents. Thankfully, there are many applications available to help parents manage allowances and teach kids about responsible spending. These apps can help you set tasks, track progress, manage spending limits, monitor transactions, and teach kids about investing and charitable giving.

Here are some applications available that can assist you in helping your child manage their allowance:

1. Mydoh: An app and prepaid card that parents can use to manage their child’s allowance, set spending limits, and monitor their spending. You can learn more about Mydoh and its features on their website: https://mydoh.ca/
2. Mint: A budgeting app that parents can use to create budgets for their kids and track their expenses.To learn more about Mint and how it can help you manage your family’s finances, visit their website: https://www.mint.com/

It’s important to note that some of these sites may have specific terms and conditions for Canadian users, so parents should always review them carefully before signing up.

Be a good role model

Kids learn by example, so it’s important to be a good role model when it comes to money. Show your child how you save money and make smart financial decisions. Talk to them about the importance of living within your means and avoiding debt.

Make it fun

Teaching your kids about finances doesn’t have to be a dry or boring experience. There are many ways to make it fun and engaging for you and your child. Remember, the key is to make it interactive, engaging, and most importantly, fun!

Here are some fun activities that you can do with their kids to teach them about money management:

1. Host a garage sale: This is a great way to teach kids about budgeting, pricing, and negotiation. Have your kids help you sort through items to sell, price them, and handle transactions.
2. Set up a savings challenge: Challenge your kids to save a certain amount of money by a specific date. You can set up a reward system for reaching the goal, such as a fun outing or a special treat.
3. Create a budget together: Sit down with your kids and help them create a budget for their allowance or money they earn from doing chores. This can teach them about planning and prioritizing their spending.
4. Play money-themed board games: There are many board games that teach financial concepts, such as Pay Day, Cashflow, and The Allowance Game. This can be a fun way to learn about budgeting, investing, and other financial topics.

There are also several Canadian websites that offer free resources and activities for teaching kids about money:

1. Junior Achievement Canada: This organization offers free financial literacy programs for kids of all ages. Their website also includes a range of resources, including lesson plans, activities, and games. Check it out at https://www.jacanada.org/.
2. The Bank of Canada: The Bank of Canada’s website includes free resources for teaching kids about money, including lesson plans, activities, and games. Check it out at https://www.bankofcanada.ca/education/.
3. Practical Money Skills Canada: This website offers free resources for teaching kids about money, including lesson plans, activities, and games. Visit their website at https://practicalmoneyskills.ca/.
4. The Canadian Foundation for Economic Education: This organization offers free resources for teaching kids about money, including lesson plans, activities, and online games. Check out their website at https://cfee.org/.

In conclusion, teaching kids about money management is an essential responsibility for parents. Starting early, using real-life examples, providing an allowance, being a good role model, and making it fun are some of the effective ways that Canadian parents can use to teach their kids about money management. By helping children to understand the value of money, the importance of saving, and how to make smart financial decisions, parents can set their kids up for a lifetime of financial success. With the available technology and apps, parents can manage allowances and teach kids about responsible spending, making it easier for them to track progress, manage spending limits, monitor transactions, and teach them about investing and charitable giving. Parents should be aware of the terms and conditions of such sites, especially Canadian users. Ultimately, parents should tailor financial education to their child’s individual needs and interests, helping them develop healthy financial habits that will serve them well throughout their lives.