Expert tips on how to make "the money talk" painless for your kids – and you

The ever-important education on spending and saving doesn’t have to be boring for your kids.
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For some parents and kids, "the money talk" is even more dreaded than "the sex talk." Think about how often you sit down for a chat about money with your children. If you don't – it's time to, say financial experts.

"Money is not a taboo subject," said Teresa Cascioli, the Halton, Ont.-based author of children's book series M is for Money, a kid's guide to financial literacy. Yet Cascioli suspects too many parents aren't having "the talk" at all, perhaps because they are bad at managing money or because they don't know where to start. But by avoiding talking about money issues now, parents are leaving their kids at risk of winding up financially illiterate in the long-term.

Indeed, study after study already shows Canadians are not saving enough for retirement. Planning ahead could help young people today, while failing to do so means they may be working far longer than previous generations.

Still – who can blame parents for putting off the talk?! It can be a challenging one for parents and boring for kids. So to understand why, how and when to have a money talk both you and your kids won't dread, we asked Cascioli and Daniel Teo, a personal finance blogger and dad of two young kids, to share their best tips for having a painless money talk.  

Broach "the talk" as an ongoing conversation

Start with something easy, said Teo. "It can be a conversation about how much groceries cost or the need to pay a bill," he said. Try an activity, such as clipping coupons, which can open the door for a stress-free chat, he said.

Then, make it an ongoing conversation instead of a one-time dreaded 'let's-get-this-over-with' type of interaction. Teo and his wife speak openly about money in front of their kids to ensure money talk doesn't scare them, he said. "It's no different than when we talk about what we are having for dinner."

Relate money, and savings, with anticipated activities

Incorporate money into things your kids already like. "Want to go out for ice cream? Scour the house for loose change first," said Teo. "Need to buy a birthday present for a friend? Compare costs at different stores….Want a family trip to Niagara Falls? Start a savings jar specific to that goal and only make that trip when the goal is reached." By merging fun and money, kids may be less likely to associate financial talk with grim memories of meetings around the kitchen table.

Start talking earlier than you might think to

"The earlier children are exposed to money concepts the better," said Cascioli. She suggests starting conversations between ages five and nine. That's when children are already learning concepts such as reading, writing and math, so financial literacy easily fits in, she said.

Teo suggests speaking about money with kids at any age. "As kids become older…bring up new topics ranging, for example, from debt and investing to the cost of post-secondary education and home ownership," he said. The more you talk about it, the easier it gets, he said.

Allowances are still a good learning ground

They're a good idea, within reason. "Give (kids) allowances and the responsibility to pay for some of their wants, whether that be books, toys, or a cell phone," said Teo. They'll ask questions, make mistakes and learn from the mistakes, he said. "The idea is to get in the habit of planning and saving, rather than spending money they don't have."

Keep talking

To help you keep the conversation going, here are some other resources you might want to consult, to find the points that will help you, and ultimately your children, most.

Make it Count, A Parent's Resource for Youth Money Management from the Manitoba Securities Commission

Teaching your kids about money, from the RBC Royal Bank advice centre                                  

Talk with our kids about money, from the Canadian Foundation for Economic Education and Scotiabank


Katrina Clarke is a Toronto-based journalist who writes about relationships, health, technology and social trends. Find her on Twitter at @KatrinaAClarke.