Preparing the next generation for wealth
Financial literacy tips for kids at every age
Discussing your family’s financial resources with your children can feel daunting. But there are ways for wealthy families to instill positive values and help children learn how to handle their wealth in emotionally, financially and age-appropriate ways, It’s never too early to start.
Here are some ways to approach conversations about family wealth at each stage.
Younger kids
▢ Teach basic money concepts
Young kids can learn the basics of money like saving, spending and sharing, especially in real life money moments, like a trip to the grocery store. Teach them to shop wisely, considering quality, need and price – and understanding the difference between wants and needs.
▢ Use allowances
Give your kids an allowance or financial rewards for chores to introduce and reinforce the value of earned money.
▢ Piggy banks or savings accounts
Encourage children to save by putting money aside in a piggy bank, or opening savings accounts in their names. Kids can watch as their money grows and learn the value of saving.
▢ Discuss family values
Talk about your family’s values related to money, such as generosity, hard work and financial responsibility.
Older kids
▢ Financial education
Help kids understand budgeting and include them in conversations about investing and financial markets. Talk about what to do with a first paycheque, or how to use a credit card responsibly.
▢ Part-time jobs
Encourage part time jobs during summers or weekends to instill a solid work ethic and financial independence.
▢ Discuss family wealth
Be open and transparent about your family’s wealth and the responsibilities that come with it.
▢ Philanthropy
Promote giving back to the community through charitable activities and donations. Consider volunteering for organizations as a family, so your kids see firsthand the difference their efforts can make.
Young adults
▢ Financial responsibility
Gradually transfer financial responsibilities to them, like managing their own investments or businesses.
▢ Professional guidance
Encourage them to seek advice from financial advisors and other professionals to learn about wealth management.
▢ Networking opportunities
Connect them with mentors and networks to help them grow their own efforts and support their entrepreneurial endeavours and business ventures.
▢ Family meeetings
Hold family meetings to discuss wealth, investments and financial strategies together.
Want to learn more?
Listen to this episode of our Conversations on Wealth podcast: “How to introduce children to wealth.”
We can help
As your financial advisor, we can help facilitate conversations around family wealth transfer. We’ll provide advice on how to structure family meetings and offer resources to help your children feel financially empowered as they grow and mature.