We believe in the importance of involving the entire family in our wealth and investment practice. Opening up the financial discussion and exploring your "money history" is a perfect way to begin the journey. Identifying the valuable traditions that mean the most to you and the areas you may want to modify can inspire the entire family. The foundation for good financial habits is established through great conversation.
Technology beats paper and in order to gain our kids attention, we need to both communicate and facilitate saving in a relatable way. This can be done without necessarily reinventing the wheel but instead by utilizing resources readily available.
- Open multiple bank accounts. Savings accounts are usually free as well as youth accounts (under age 18).
- Allow your child to open as many as they like and name them based on their goals e.g. Car, Travel, Education.
- Build a realistic savings strategy. As an example, if they have a goal of saving $100 per month, ask them to break it down by level of importance and time horizon e.g., $30 to car, $20 travel, $50 to education.
- Automate it. Utilize the preauthorized debating system most banks offer for free. When the income comes in, it automatically is moved to these accounts following the "pay yourself first" theory.
Not only will this allow for celebration when a goal is achieved but it will also create saving habits that will last a lifetime. The goals and amounts will change but the habits are in place for each new phase of life.
Learn At Every Age
Age four to seven - Understanding how money is used
- Earned, spent, saved or shared
- Piggy bank or bank account (online)
- Participate in transactions at the store
Age eight to 12 - Making financial decisions
- Spend, save or give
- Deals and discounts
- Open chequing and savings account
Age 13-18 - Understanding day to day cost of living
- Budgeting essential
- Flow through saving strategy to different accounts named by goals
- Power of compounding interest
Age 18+ - Ready, Set, Go!
- Registered accounts
- Investing 101
- Home buyers programs