Over the past month I have had a number of conversations with clients on the subject of children and money.  These children range from 6-36 years old!  One of the pieces is how the digital age and our cashless society is impacting our children and this subject makes for a very interesting discussion.

I remember when my sons were younger and had access to cash through ATM’s.  They had to physically go to a machine to withdraw money.  Now, they can use digital payments and never actually see the cash leaving their hands.  How will they understand where that money is going?  How will they be able to respect this cash they never hold, learn the value of money or learn to save money for their future?  What is the impact?  Will this lead to a generation of overspending that exceeds our current generation?

Kids are learning at a younger age the concept of making digital purchases without even realizing what the process of the transfer of money entails.  It is our responsibility to teach our children how about digital payments.  We need to have these conversations with our children so they understand how money is attained, where it goes when we spend it, how to keep track of their spending and how to manage it.  I still believe in the old chequebook for keeping track of my spending habits or you could use an excel spreadsheet but you need some tracking device.

Here are some great tips to teach financial literacy to children of various ages:

  1. Age 5 – 6: Introduce your child to money through board games or role-playing games that involve money,  including coins, bills, debit cards and credit cards.
  2.  Age 7 – 8: Take them to the bank to open their first savings account with online access, and encourage them to save a portion of their gift or allowance money.
  3. Age 9 – 10: Talk to your child about your job and what you do to earn an income, and show them how you’re paid. Talk about small ways they can start to earn money, including extra chores like walking the family dog, doing yard work, or being a “parents’ helper.”
  4. Age 11-12: Discuss your financial goals with your child. Show them how you budget and ask for their input on the family’s spending on vacations, holidays, gifts, etc.
  5. Age 13 – 14: Help your child track their spending. Review account balances and interest earned on deposits. At this age, introduce the concept of credit; show them your credit card bill and explain how interest charges work.
  6. Age 15 – 17: Teach your child about credit-worthiness and the importance of a good credit score by always making timely payments on credit cards and utility bills and how this will help them when it comes time to get a student loan, car loan, or qualify for a mortgage.

I am sure we all wished we had shared our financial wisdom with our children as in the steps above but it is more important than ever in this digital age to teach our children financial literacy!


Colleen Saunders is a 20 year veteran in the mortgage industry, serving Oakville, Mississauga, Burlington and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on  www.mortgagesbycolleen.ca  or call 416-459-2406