This post was created in partnership with RBC.
Last week my son Holden, who’s ten-years-old, accidentally smashed his sister’s device. She cried and he felt terrible. Holden turned to me immediately and told me exactly how much he has saved in his bank account and that he has enough to replace it. His eight-year-old sister Beau, heard, “I have money and will compensate you.” She has since then pestered multiple times a day for her brother to buy her a mini fold-out sofa she saw online instead of a device. “That’s not how it works Beau,” I replied with exhaustion.
As with any big conversation as our kids get older, we try to feed them pieces at a time so that the information is digestible, and age appropriate. It’s really important to us that our kids grow up knowledgeable and confident when it comes to finances and managing money.
Holden is now at the point where he has a bank account, earns money from time to time and deposits it into his account where he is saving for University (according to him). I think that’s a pretty great start.
Beau on the other hand is still in the thinks money grows on trees phase. It is time for Beau to understand more about money and managing it. So, this fall we plan on opening Beau her very own RBC Leo’s Young Savers Account. Including her in the process, like we did with Holden, will help build the excitement around opening her own account, and help her understand the responsibility that goes along with it.
On the other hand, Holden has shown us so much understanding and responsibility, which means it’s time to arm him with more information. Recently we made the decision to get Holden his own smartphone. We were hesitant at first, but since we don’t have a landline and neither do his friends, it became necessary in order to give him more freedom. He can text and call… but no social media for many more years.
The phone has also become an opportunity to teach him about money and RBC’s new Mobile Student Edition is the perfect next step for him, which Holden can access on his smartphone. The RBC Mobile Student Edition which is built within the RBC Mobile app will allow Holden to view his accounts and have insights on his spending. It’s also customizable, which means he can create nicknames for different categories, change colours and upload contact photos.
Now, we’ve decided to set up an automatic e-transfers so his allowance can be deposited into his account each week. I don’t know about you, but we are the worst at keeping up with allowances because we either forget, or don’t have the cash on hand. Not to mention the frustration I’ve felt when I’ve found money laying around because one of our kids has decided to pillage their piggy bank. This happens way too often in our house! Now, with the Student Edition of the mobile app, Holden can watch his money grow and even get quick touch definitions in age appropriate language for all the banking terms and jargon that is relevant to him!
I am excited for our kids’ future, knowing that they will be financially savvy. How do you teach your kids about money?
Here are some bonus tips from RBC to help teach your kids about money:
ABC’s of Family Finance
A is for adding up: Pick a savings goal and create a family plan. Whether you’re putting cash in a jar or saving digitally, children of any age will benefit from a visual aid about how money adds up over time. And help older children create a budget for their allowance or earnings from part-time employment so they can help contribute to the savings. Add in a charitable donation, consider building towards a fun day trip – find ways to get children excited about the final result.
B is for bank account. Take your children to your local bank branch to open up a young savers’ bank account so they can learn how it all works and how to save. As your children get older and their bank account needs change, branch staff can explain how decisions made today can impact their longer-term goals.
C is for cash. As a family learning exercise, use real money to teach your children about household expenses. A great example is groceries: if you take your child grocery shopping with you, they inevitably ask for extra items that are not on the list – or not within budget. Show them what your overall grocery budget is with cash and help them learn how all the small items add up. Take it one step further and talk about how spending over or under the allotted amount impacts your overall household budget.
Disclosure: This post was sponsored by RBC. While compensation was provided, all opinions expressed herein are those of the author and are not necessarily indicative of the opinions of RBC.