Teaching Your Children to be Money Smart

Posted 29 Sep 2017 by Melissa Allan

One of many things parents have to face these days is the fact we may be raising “entitled” children.  I realize that’s a broad statement but let’s face it – kids of this generation have it better than we did!  As a parent, I personally don’t want to raise my children to think they can have whatever they want. 

I thought I’d write a few tips to consider from the perspective of a parent and a financial advisor:

  • Talk with your kids about the cost of everyday items like food and clothing and how your family balances those expenses. If they see you creating good spending and saving habits they’re likely to follow suit. If you have bad saving habits you’re most likely passing them onto your children too. I remember my teenage years and complaining to my mother about money. She simply handed over her cheque book, told me to start paying the bills and let her know what was left. It was an eye-opening experience and one that has stuck with me decades later.
  • Look for sale items at the grocery store – together. Some items are must-haves no matter the price but I recommend letting your children pick out small things such as cereal or juice and let them choose from the sale stickers.  Small, subtle activities like this instill good habits down the road when they’re shopping without you.
  • Open a bank account with them. I recommend having your child open a bank account at around 10 years of age and deposit birthday and Christmas funds in their account.  Most big banks have youth bank accounts with no banking fees, which makes this easy. 
  • Have your children use some of their own money to buy things. Discuss splitting their gifted money between savings and spending. Perhaps they have a special item they long for (like a video game), savings for a longer-term item (like a bike or even a car down the road) and then the fun/flex money they can use now. 
  • Encourage them to earn money. Whether it’s through chores, a paper route, babysitting or otherwise, this will help them make the connection between work and its reward – also known as a paycheque.
  • Teach your teenaged children how to pay bills and log into their own bank accounts. This works well for things like cell phone bills. Most parents are joint owners on bank accounts, which is a great idea, but allow them to use it independent of you (probably with your help at first).


  • Don’t give your teen a credit card!  Just don’t.  They are too young to handle it and if you bail them out of their spending without consequences it will happen again.
  • If you do give your child a cell phone, I recommend having data off and if they do go over your plan limit, use it as a life lesson.  Take their phone, make them pay the bill or whatever works for you.
  • Don’t give into your child at a store when they want that special toy or treat that wasn’t planned.  Explain the difference between needs and wants, and what you’re there for that day.
  • Don’t give them a weekly allowance without doing their chores around the house.  They should be doing this as a member of the house anyway but parents often give the allowance without the child doing the chores, defeating the purpose of “hard-earned money”!

Share your tips for teaching your kids about personal finances with us, and with your friends.  Create good habits to pass onto your children and start educating them when they are young!  It’s all about finding a balance and preparing them for the real world.


This information is general in nature, and is intended for informational purposes only.  For specific situations you should consult the appropriate legal, accounting or tax advisor.