Teaching children about money

Starting to talk about money with your children

Teaching children how to manage money will help them throughout their lives. If you start early, you can build on their knowledge as they grow.

Talk about money when your children are around so they are familiar with financial terms and concepts. Make sure they understand where money comes from. People work to earn money. Then they buy things with the money they earn.

Use everyday activities to teach children about money.

When you’re out shopping or running errands, talk about:

Help children understand the difference between needs and wants. They should spend money on the things they need before the things they want. This will help them make good spending choices.

Try this activity with Bank of Canada Museum to help your children figure out needs and wants.

Teaching your children how to save money

Teaching your children how to save money can help them:

When talking with children about saving, discuss goals that appeal to them. For example, they may want to save for a video game or special activity.

As children get older, talk about saving for longer-term goals. Encourage them to set reasonable goals.

Have them figure out how much and how long they must save for to reach their goal.

Make learning about saving fun

Read and do activities with your children to teach them about saving money. When you read to them, find stories that have to do with earning, saving and financial goals.

Make it interactive. Play games when shopping, such as comparing items to see which is the least expensive.

Use jars or envelopes for savings goals

Children can use jars or envelopes to divide up their money. Have one for money to spend and one or more for money to save. Provide a separate container for each savings goal.

Use the Financial Goal Calculator to teach them how to set financial goals.

Consider contributing to your children’s savings

You may choose to encourage your children to save by matching their savings. Your children may be less likely to get discouraged with saving if you help them reach a savings goal.

Open a savings account for your children

A savings account is a tool that can help teach children to save. It’s a safe place to put their money when they’re saving for a purchase.

Choose a savings account that pays interest so they can see their money grow over time. Many financial institutions also offer no-fee accounts for children and youth.

Have them make their own deposits. This will help them understand how they work.

Use the Account Comparison Tool to find a savings account that best suits your children’s financial needs.

Giving your children an allowance

You may decide to give your children an allowance. Giving children pocket money is a good way to teach them how to manage money. It may encourage them to make wise decisions about spending and saving.

Decide how much to give as an allowance

The goal of an allowance is to teach your children how to manage money. How much you give is less important than the goal.

When deciding how much to give:

Expenses they may want to cover include hobbies, games, toys and more. You may increase the amount or frequency of payment as your children get older.

Decide when you’ll stop giving an allowance

You may choose to stop your children’s allowance when:

When you stop giving the allowance, discuss this with them. Make sure your children understand what expenses you’ll pay for, and what you expect them to pay for.

Teaching your children about how to earn money

Your children may earn money by getting an allowance and making interest on their savings . Once they get a little older, they may also earn money by doing basic chores or getting a part-time work.

Some ways children may earn money include:

Earning this extra money on their own may teach them about financial responsibility and independence.

Your teen’s first job

When your children become teenagers, they may want to get a job to save money and cover their expenses. Their first job is an important step in earning and managing their own money.

Encourage your children to set up an automatic transfer of part of their paycheque to a savings account. This way, they can save for long-term goals.

Learn more about starting a first job.

Resources to help you teach your children about money

Many resources are available to help you teach your children. These may include phone and online applications, books, games and activities. Consider the following resources when looking for support to teach your children about money.

The Bank of Canada Museum has fun resources and activities for kids to learn about the economy and financial system. You can search resources based on your children’s grade level.

Examples of topics include:

Find learning resources based on your children’s grade level.

The Canadian Foundation for Economic Education developed a program called Talk With Our Kids About Money (TWOKAM). This program offers many resources for kids to learn about money. Resources include games, activities and movies for children of all ages.

Examples include:

Find activities and games based on your children’s age.

Visa’s Practical Money Skills website also has useful resources to teach children about money. “Your money, your future” is an interactive guide for students. It helps them learn about saving, budgeting, spending, borrowing, and more.

Find Visa’s interactive student guide.

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