When I was a kid, I didn’t talk to my parents about money. I gleaned financial lessons from overheard arguments involving cut-up credit cards, and reminders that we needed to defer shopping until we got the “baby bonus” (the charming nickname we had for the government’s child tax benefit).
While it wasn’t necessary for me to get all the information behind these scenarios when I was nine, surely hearing things without understanding them left some sort of imprint on my feelings about money as a grown up.
It can be tough to decide exactly how much information to share with your kids, and when. It can be even tougher to override your own internal tapes, which dictate your relationship with money, so you don’t pass the same message on to your kids.
Money is almost as bad as sex in its taboo nature: parents don’t want to talk about it out loud, and they definitely don’t want their kids knowing what’s going on right under their noses.
If parents don’t kids the ins and outs of using money, how are they going to learn? Will they have to suffer through crushing debt before realizing how important it is to borrow responsibly? Will they hoard and safeguard money for fear that they’ll run out, never balancing the need to enjoy the fruits of labour in everyday life?
The best plan is to do some teaching yourself to ensure youngsters have a solid base in financial knowledge. When do you start those lessons?
Sooner rather than later
“Research shows that starting to learn about money as early as possible is a great way to give kids a head start in the process of building healthy financial habits,” said Jane Rooney, Canada’s Financial Literacy Leader, in a press release from April 19, 2017 from Canadian Foundation for Economic Education (CFEE). CFEE’s program “Lets talk with our kids about money” provides free educational resources to parents and teachers, and the lesson plans start for kids as young as five.
Of course, if you’re teaching money matters to kids who are just learning to talk, the lesson has to be child appropriate. Start with the value of money, how the money we spend comes out of the money we make, and that there’s a limit to how much we have.
“Talk about work – teach your child about the relationship between work and money,” suggests GetSmarterAboutMoney.ca, a website run by the Ontario Securities Commission.
If you need some inspiration for how to start, The Consumer Financial Protection Bureau has suggestions for age-appropriate money skills you can work on with your child.
Watch your words
When you choose to talk about money is really important for kids. But never underestimate the power of the words you use to convey the information. Parenting experts tell us there are good and bad ways to talk to kids about money. For instance, you never want to tell a child “that’s too expensive, we can’t afford that,” especially if you go out and buy the item anyway.
Instead, if your kid gets a case of the gimmies, tell them it’s not in the budget; it’s not about running out of money, it’s about running out of money in that budget line.
“When you’re ready, tell your child that you cannot buy new toys right now, but perhaps the toys can be put on a wish list,” suggests KidsHealth.org. “Be honest with your children — but don’t tell them more than they need to know.”
Walk your talk
After you’ve started teaching kids how to use money responsibly, make sure you follow your own advice. “If you are an extravagant shopper yourself or are wasteful with money, it does not set a good example to your kids on how to manage money,” advises the Child Development Institute.
Above all, don’t fall into the trap of getting defensive or cagey about what you have or don’t have. Money is a tool we use to get through life. Your bank account isn’t a testament to your personal value, nor does it reflect your kids’ worth. If kids are worried about what other families have that you don’t, the best thing to tell them is exactly what you should be telling yourself: just because others have it doesn’t mean they can afford it, and perhaps you are prioritizing different things with your money.