Fifty-eight percent of Canadian parents say they frequently worry about their kids’ financial futures, according to a recent survey by TD. But why?
Many adults — now parents — may have grown up in families where financial literacy for kids wasn’t top of mind. In fact, most parents (60 percent) claim they have made mistakes with finances due to a lack of financial education in their own childhood. While most parents know that teaching kids about money is important, the survey also revealed that 70 percent don’t feel prepared to support their child’s financial literacy. In addition, only 29 percent of parents regularly discuss personal or home finances with their kids weekly.
TD wants to change that by providing families with the information they need to build healthy financial habits. Read on to learn how to talk to your kids about money.
According to the survey, two in three Canadian parents are not highly confident in their children's financial knowledge for their current age, and 89 percent agree they would feel more confident about it if their child had improved financial knowledge before their teenage years.
“Teaching children basic money concepts is the foundation of financial literacy. A general rule of thumb is to start early, practice often and lead by example,” says Emily Ross, vice-president of Everyday Advice Journey at TD. “Let your child know that, as a family, it's important to spend responsibly and build your savings.”
Kids as young as three can learn basic money management concepts like counting, identifying different bills and coins or saving money for a special item. “Next time there is a toy, game or article of clothing that your child wants, try to help them understand how much money it costs,” says Ross, adding that you can help them save up for the item and keep track of their progress.
This goes for older kids, too. It’s all about keeping the lessons appropriate for the age and stage of your children. Ross says, “In the case of teens aged 13 to 15, when shopping, you could discuss the difference between debit and credit cards or how to budget effectively, which will help them save for an item they've recently had their eye on.”
It can be challenging for some parents to be open with their kids about money — especially if talking about finances was considered ill-mannered when they were growing up, or if they’ve made financial mistakes of their own. “Just remember that, by nature, kids are curious and resourceful. As parents, we want to listen and provide honest answers to their questions. By doing so, we can ensure that we start and maintain a healthy dialogue on managing money and building for the future,” says Ross.
From playing money-based games with toddlers (who doesn’t love a good game of cash register?) to planning a family vacation, money doesn’t have to be dull or difficult. You can budget, save and plan as a family which makes the end result — that amazing trip — that much more satisfying. “A regular allowance is another great way to teach kids about the value of money,” says Ross. “Once your child reaches their savings goal, celebrate their achievement.”
TD is a great place to start your child’s financial education. Take a special trip to your local branch to open your kid’s first bank account and join the 71 percent of Canadian parents who have set up a chequing or savings account for their eldest child.
The TD Student Chequing Account comes with no monthly fees, unlimited transactions and no transfer fees to send or request money via Interac e-transfer. Plus, kids earn interest on every dollar they put into their accounts. TD also has great digital resources, educational guides and budgeting tools to help further your family’s financial awareness and offers in-branch activities and educational tools that are designed to make banking fun for kids.
TD aims to be the financial partner families need. In addition to providing in-person support at a branch near you, you can also reach out online or over the phone. If you have questions, TD will have answers.
TD also supports the financial security of kids through the TD Ready Commitment program. This initiative was launched in 2018 with the goal of making a more inclusive and sustainable tomorrow. TD Ready Commitment is dedicated to improving access to tools and programs that help people live their lives with greater financial confidence. Areas of support include early learning, financial literacy and affordable housing.
Everyone deserves to feel their financial feet under them. TD knows this better than anyone and is committed to helping the next generation learn how to make this a reality.
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