When it comes to teaching kids about managing their money, get them while they're young.
That's the advice from successful Canadian businesswoman Teresa Cascioli. She's the former CEO of Hamilton's Lakeport Brewery, which she transformed with her "24 for $24" pricing and marketing plan.
Now she has a new series of books called M is for Money, aimed at educating kids in elementary school about how to manage money. The CBC's Conrad Collaco spoke with her about how to teach kids to manage money well.
Click on the image at the top of this page to listen to the full interview. Below is an edited and abridged transcript of that interview.
Teresa Cascioli, entrepreneur, former CEO of the Lakeport Brewing Company
Q: How did you build your wealth?
My parents are immigrants. They taught me that when you go to the grocery store that if there's change that they needed it back. There were other things it needed to be used for. They taught me by example and by conversation that you needed to make difficult choices. When I got to Lakeport, I already knew you had to make tough decisions with the limited resources that you had. These were lessons I learned when I was five, six-years-old.
Q: How did your parents talk to you about money when you were a child?
They weren't afraid to tell me "you can't have this and here's why." It wasn't just "no," it was "no and here's why." The M is for Money book series helps parents and teachers start those conversations. Parents are really busy. Teachers have jammed curriculums. Trying to make those conversations easier to start, that's the objective of the books.
Q: Why do you think it's so difficult for parents to talk to their kids about money?
These are difficult topics to begin. How do you talk to a child about a loan? In the book, I refer to it as a promise to pay. What's a bank? A bank is a big, big piggy bank. You have to put your mind inside that five to nin age group to explain those concepts. It's not easy to step back and talk to a five-year-old about a loan or a budget. These books make those concepts kid friendly.
Q: What challenges do parents face now with children's financial literacy that they didn't when you were growing up?
We didn't have online apps and computers to make purchases with. The decision to buy took some time. Now it's very simple. You think about it. You get on an app and you can purchase it within minutes. Now more than ever, it's important to have children thinking before they click. If they don't, there will be financial distress in their lives. When they get old enough to spend, they need to know where the money came from, how hard it is to earn and how difficult it is to make choices with competing priorities.
It's easier when you have something where the kids don't feel like they are learning a lesson. They're hearing a story about two kids they can relate to. It doesn't feel like a lesson. They are very much engaged.
Q: What's the biggest mistake young people make when they first start managing their own money?
The concept of it being limitless. "I'll just buy this and figure out how to pay for it later" as opposed to "if I buy this, how do I pay for it." Then they get in a bit of trouble and they have to go to their parents, or whatever. We all want everything but we all have to work for it. Then you have to ask yourself "should I use that money to buy a purse or a pair of shoes or should I pay down my tuition?"
You can't have everything at once. You can have everything eventually if you work hard enough but you can't have everything at once.