small reduction in their allowance is worth it to avoid the chore. An allowance is a tool to teach money skills, not ensure children complete their chores. A better approach would be offering to pay an extra amount for chores over and above the normal requirements. An example might be washing the car. What a great way to encourage initiative and motivation. When a child starts to receive an allowance, it is an opportune time to introduce the notion of a bank account. Most, if not all, Canadian financial institutions offer a children’s savings account. These accounts are usually no fee, pay interest and may offer debit card access. The rules and interest rates vary from institution to institution so you need to check around. They can deposit their 10 per cent and over time watch interest accrue, thereby introducing the idea of interest and earning a return. Again, a rule needs to be set on what constitutes a valid reason to withdraw funds from the account. Another learning occasion is introduced if the account offers debit card use. Canadians are the world’s largest users of debit cards, and learning the do’s and don’ts of their use is essential. Another great teaching opportunity is shopping with your kids. “Take my kids shopping! Are you crazy?� It may sound crazy, but surprisingly, even though we all shop, a large number of Canadians do not have good shopping skills. Having your children help with grocery shopping will introduce important concepts such as meal planning, making a grocery list, looking for bargains and dealing with conflicting wants. Like handling money, effective shopping is a life skill that they will always use. As you move through the aisles, you can discuss price comparisons, expiry dates, healthy vs. unhealthy eating, and nutritional value. Take a calculator and compare items against each other to see how the grocery bill is affected. Children learn early and quickly. The ideal time to start them on the road to good financial literacy is as soon as they are able to understand basic concepts. An allowance is fundamental in setting them on the road to a happy financial future. Tie in a bank account and shopping and you will have done them a favour they will never forget. Keith Guinchard is a former financial planner and non-profit debt counsellor who maintains a keen interest in financial issues and their effect on families. He can be reached at keith@keithguinchard.com.
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LIFE Seminars Sidestepping Victoria’s most the Power comprehensive programs. Struggle presents
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with Dr. Allison Rees
lifeseminars.com 250-595-2649
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