According to a recent TransUnion survey, 47% of Canadians are committing to at least one financial resolution this year. That being said, 37% did not reach their goal in 2013.
Resolutions are easy to make, hard to keep. Goals can more attainable if you have a coach in your corner. So let us help you tackle your financial resolutions for 2014.
‘Resolve the make your kids more financially savvy than you were’
Motivational quote for your fridge: “Teaching kids sound financial habits at an early age gives all kids the opportunity to be successful when they are an adult.” —Warren Buffett
Pep talk: Sure, we all want our children to be happy. But let’s be honest — what we’d rather be saying is: we all want our children to be rich. Well, you can point them in the right direction. Warren Buffett says his greatest inspiration was his father who taught him about the value of saving. This is your chance to give your kids something better than money. Teach them to fish, so to speak.
Peer support: When Naomi Mesbur’s son, Ciaran, was born, she was in debt.
She had helped fund her first husband’s business and supported them when he became ill. When he died, she had $40,000 worth of debt.
It’s a family cycle of negative behaviour that you want to stop for your children
“I don’t want to leave debt for my kid,” the 43-year-old Toronto legal assistant says. “I also want to teach him so that he doesn’t end up in this mess.”
She looks for teachable moments. She talks to Ciaran who is seven, about prices at the grocery store. They play Monopoly. She brings him to dollar stores for treats. “[I tell him,] ‘You can get one thing…but it can’t be more than $1.50.’ So he chooses something and looks at the prices.”
Every week, his school has pizza day. They go to his piggy bank for the money to purchase a $2 slice and a $1 drink. If he wants an extra slice, he can help around the house for more money.
“It’s a family cycle of negative behaviour that you want to stop for your children,” she says. “I’m a single mother. To set new economic standards for the future, we have to teach the kids now.”
Expert advice: “You don’t have to talk to kids about derivatives,” says Gary Rabbior, president of the Canadian Foundation of Economic Education. “Don’t be fearful if you’ve made mistakes and you haven’t necessarily been perfect in your own life. Often mistakes are the best lessons.”
“Money is becoming much more important in people’s lives today and they’re involved in so many more decisions. If they’re going to make those decisions, they should have the basic understanding to be able to make good ones. If you don’t help them, the consequences of the mistakes they can make are having greater impact on their lives. If you make mistakes early, it can leave a legacy for a long time that you have to overcome.”
- Involve your kid in your everyday finances. This doesn’t mean making them calculate your taxes. Talk to them while grocery shopping. Show them that you’re comparing prices.
- Don’t lecture. Your money lesson has to be fun and engaging. You want to talk about savings? Paint a piggy bank or decorate a change jar to accumulate money.
- Consider giving them an allowance. Some believe that children should not be paid for chores, but it’s up to you. Offer them an opportunity to earn extra income – maybe doing stuff no one wants to do such as vacuuming the car or massaging grandma’s feet.
- Count the money in their piggy banks regularly. Tell them how close they are to their goals. Tell them how awesome that is.
- By the time that your savvy kid is in elementary school, they may be ready for their own bank account. Your financial institution may require documents to open the account, including a SIN card, a birth certificate or passport; ask if they have a no-fee account for children 12 and under.
- Teach them that every decision involves a trade-off. “Whenever you do something, buy something, there’s something you’re giving up to either buy with that money or do with that time,” Mr. Rabbior says. If your child wants a new bike, for example, ask if he’s willing to spend his savings on the bike now or continue saving for the video game consul to get it sooner. “Help your kids value the future versus the here and now.”
- If you budget and keep track of your expenditures, let your kid in on it. Talk to her about why daddy is walking empty-handed out of the electronic store.
- Help them set up a business. (And maybe explain to them that their lemonade earnings need to cover your initial investment of lemons and sugar.) Mr. Buffett started his first business when he was six. He bought a six-pack of pop for 25 cents and sold each one for a nickel.
- If you volunteer or donate money, explain why you do it. Encourage them to donate old toys, books and clothing to others. Let them put money in charity boxes. Get their help picking out canned foods during food drives.
- Talk to your mini-consumer about smart consumerism. Look at ads in the media and talk to them about strategies the company uses to try to convince shoppers to buy their product. If they’re buying a product, help them look at different options and compare prices.
- Figure out what you spend on your teen’s wardrobe and give it to them to budget. Remind them that the money is finite for the year.
- Movies about money to watch with the family: Richie Rich, Toy Story 2, Field of Dreams
- Children’s books to read about money: Something Good by Robert Munsch, A Chair for my Mother by Vera B. Williams, Rock, Brock, and the Savings Shock, by Sheila Bair
- Games to play: Monopoly, Exact Change, The Game of Life, Payday
Mortgage Man – Dominion Lending Centres | Ph: 705-326-8523 | Fx: 705-326-8645 | www.markgoode.ca | FSCO# 12254 | 180 Memorial Avenue | Orillia, ON L3V 5X6 | â€¨
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