Money is still considered by many to be a taboo topic or private matter, which is why many people avoid sparking up conversations about their personal finances with friends, colleagues and even family.聽
Yet, when it comes to your kids, keeping quiet about money might actually cause more harm than good.聽
Experts say that parents should start talking to their kids about money from an early age as it will help them develop a healthy relationship with their own finances one day.聽
鈥淗andling money is a life skill just like cooking is a life skill,鈥� said Liz Enriquez, a Hamilton-based personal finance educator at Ambitious Parenting.
Parents shouldn鈥檛 rely on the education system to teach kids about finances, especially since they may not cover a lot on the topic, she said. Instead, learning should start at home and whatever children discover outside of the household can be considered supplemental.聽
Parents don鈥檛 always take this approach, however.聽
Often, parents will hold back from talking to their kids about money because they鈥檙e insecure about their own financial situation. These might be parents who are in debt, don鈥檛 understand how to invest, or just generally have the mindset that they鈥檙e 鈥渂ad with money,鈥� Enriquez said.
But, even if you don鈥檛 have a handle on the stock market, talking about how to spend within one鈥檚 means, how to save money, and what delayed gratification looks like around money can go a long way, she said.
Bruce Sellery, CEO of Credit sa国际传媒 Debt Solutions in Toronto, said parents may also stay tight-lipped because they want to shield their children from the constraints they feel about money, especially as finances continue to get tight for a lot of Canadian families amid soaring inflation.聽
He argues, however, that there鈥檚 value in having conversations with your kids in a transparent and age-appropriate way.聽
鈥淥ne of the things we鈥檙e preparing our kids to learn is how to navigate risk. And, if you don鈥檛 learn how to use money as a tool, as you grow older, you鈥檙e exposing yourself to real risks.鈥澛�
Conversations around money can start as soon as you begin engaging with your kids about any topic, Sellery said.聽
鈥淲ith my kid, they were in the grocery store with me from the time they were born and as they developed language, I talked to them about everything,鈥� Sellery said.聽
As they walked down the produce aisles together, Sellery said they would scope out fruits and vegetables and discuss how much they cost.
Children become interested in being part of that experience and the lessons can become more vivid and specific as they get older, Sellery said.聽
鈥淥ver time, you鈥檝e got a kid who can look at the unit price on a box of cereal, and that happens when they are maybe five, six or seven depending on their development.鈥�
When speaking with kids about money, and specifically needs and wants, focus on the facts rather than letting emotions get involved. And, make sure that too much time doesn鈥檛 pass between these conversations, Sellery said.
鈥淚f you can鈥檛 think about the last time that you talked about money, it鈥檚 been too long. You should be able to recall the last time that you talked about it.鈥�
Some conversation starters could begin when you鈥檙e paying bills at the dining room table, he said.
If you鈥檙e about to pay the credit card bill, for example, highlight how much you鈥檝e been spending and on what items. This is also an opportunity to explain what happens when these purchases are not repaid on time.聽
If you have a Registered Education Savings Plans for your children鈥檚 post-secondary education, talk about how that specific savings account works and the value of putting away money for the future.聽
And, when it comes to the activities your kids enjoy participating in, open up a dialogue by explaining which activities cost money and why certain choices have to be made.
Sellery doesn鈥檛 believe it鈥檚 helpful to shield kids from scarcity, and advises that if families don鈥檛 have actual scarcity, parents create it so that their kids understand there are sometimes limited resources to work with.
"I intentionally don't replenish on certain things that they have an interest in so that they don't think that there's just some magical place where sugar and flour and all the things they like to bake with just automatically shows up," he said as an example of creating financial scarcity.聽
But, while you might want to be frank with kids about money, be careful that you鈥檙e never guilting them about how much you work or how much you spend on their behalf.聽
鈥淭here is a very fine line between making your kids aware of the trade-offs you鈥檙e making and guilt,鈥� he said.
For example, guilting might look like saying 鈥淚鈥檓 working overtime for you and you鈥檙e not trying hard at ballet.鈥�
Instead, you might want to say 鈥淟isten, if you don鈥檛 want to do ballet, that鈥檚 fine. We can not pay for that. But, if you鈥檙e going to do ballet, you need to show up and be ready,鈥� he said.聽
This report by The Canadian Press was first published July 11, 2022.
Leah Golob, The Canadian Press
