Posted on Tuesday April 10, 2018

Dollars and sense: Seven good reasons to talk money with the kids

Spend wisely, save your earnings: these are great habits to instil. The knowledge and values you pass on to your children will serve them their entire lives ? which makes having the money talk a win-win. Below, a few tips to help you get started.

Getting off on the right foot

It's almost never too early for kids to learn that money doesn't grow on trees. And in terms of cultivating healthy attitudes to money management, parents are ideally placed.

Except that . . . having the money talk can be tricky. In some households, the topic is all but off-limits. You're probably aware of what you pay for phone, electricity, cable and Internet ? not to mention groceries, generally the second or third biggest expenditure in Canadian households. Yet where the kids are concerned, these questions are raised all too infrequently. Here are seven good ways of helping them get a handle on money matters.

Tips for teaching kids the value of money

1. Playing ?shopkeeper? or Monopoly are excellent ways of teaching kids that buying things takes money ? and that sometimes you have to make choices. Bonus: games like this let them handle ?currency.?
2. Head to the mall or grocery store and have them compare the prices of similar items, then select the one they feel is the best offer.
3. Don't be shy about emphasizing the need to work to earn money! Having them do chores in exchange for pocket money is the classic way to bring the idea home.
4. Need vs. want. Getting this fundamental distinction across is crucial.
5. Healthy habits. When your children receive money as a gift, encourage them to divide the amount in three, with one part to spend, one to save and one to share (e.g. by donating to a favourite charity).
6. Setting an example. When you shop with the kids, be aware that they'll note and mimic your behaviour. Ask yourself this: what message do you send when you spend?
7. Teaching delayed gratification: to combat the ?buy now, pay later? mentality, reinforce the idea that waiting pays off. One way of getting the idea across is to take them to a store and watch as they shop within the limits of their means (for example, their saved-up allowance). The choices this will entail will make it clear to them that they can't just buy whatever they want.

Saving: a form of discipline that pays dividends!

As soon as they start school, kids in New Brunswick can open a savings account through the School Caisse, the result of a 75-year partnership between UNI and the province's schools. This lets them make deposits on a regular basis and see their savings grow.

Still, saving money takes discipline! With your child, come to an agreement on the portion of their pocket money that will be put toward savings. For instance, if their weekly allowance is $10, you can agree that $5 will go to the School Caisse, leaving the rest available for personal spending. By setting some (but not all) of their money aside, they learn to save without being deprived. A smart compromise!

The good news? The School Caisse was recently revamped to make kids' accounts available through AccèsD. A tech-savvy turn that lets kids manage their finances on line and learn about savings through fun interactive features like this great online tutorial!

Want some tips on nurturing a money-saving mindset? Your UNI advisor can help you help your kids develop the right reflexes as well as walk you through the School Caisse!