Money & Career

How to talk to your children about spending, saving and charitable giving

Author: Canadian Living

Money & Career

How to talk to your children about spending, saving and charitable giving

We still remember the day our parents took us into the bank to open our first savings accounts.

We strode in, hand-in-hand with our parents, feeling like we were finally all grown up. I remember barely being able to see over the counter. The bemused cashier accepted our envelopes full of loose change and one- and two-dollar bills (yes, they did exist back then). She handed over our bankbooks and we signed our names on a legal document for the very first time.

We left feeling like we had accomplished something big.

On the drive home, our parents took the opportunity to explain the importance of saving our hard-earned money. They suggested we start putting money aside for a college or university education. The idea of saving for something so far in the future didn't resonate at the time. We were far more interested in saving money for a bike, roller skates or a skateboard.

Mom and Dad pushed Craig and I a little further – what about saving for a gift? Not just gifts for family and friends, but a gift that would truly help someone in need.

That idea caught our attention and we spent a considerable amount of time discussing with our parents what our funds could buy. As we looked through pamphlets of charitable organizations as a family, we became excited to think that we could save enough to buy a goat, a chicken or even some school supplies for communities in developing nations. We selected our gifts with great care, and the lesson has stuck with us all our lives.

It's never too early to start a conversation about saving, spending and giving back. This life lesson helps children with financial literacy skills, while also providing an opportunity to start a conversation on the importance of sharing our gifts.

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Craig and I believe that any discussion with your kids about finances must include a conversation on philanthropy. Consider Keith Taylor, a professor from Nashville, Tenn. Although one of his dreams was to become a philanthropist, he always felt it was beyond his means. To him, a philanthropist was a person with hundreds of millions of dollars available to donate. How could the average person make a contribution that mattered?

Keith realized he needed to change his definition of philanthropy. Throughout his life, many people had helped him through financially tough times. None of them had been rich or given him very much money, but they had offered him a gift when he needed it most.

From this realization came the launch of the website, modestneeds.org. Taylor pledged to donate ten per cent of his monthly income to people who didn't qualify for conventional charity, who were working as hard as they could, and who encountered a small, unexpected expense that threatened their financial stability.

The idea snowballed, and Modest Needs has become a community of exceptionally caring people who have chosen to give whatever funds they can in order to help others. They give not because they have to, but because it gives them pleasure to do so. Today, Modest Needs helps an average of one person a day and has given away more than a million dollars, while its founder, Keith Taylor, proudly says that he fulfilled his life goal of being an active philanthropist.

The story of Modest Needs shows how just a small amount of money goes a long way in reaching out to others. Teaching children to donate to charity allows them to feel not only the pride of managing their own bank account, but the pleasure of philanthropy and generosity as well.

Tips for parents:
1. If you give your kids an allowance, encourage them to divide it into three: Save some, spend some and share some.

2. Teach your kids to balance their own needs with those of others. When giving them their allowance, let them decide if a shopping expedition is really necessary or if they would prefer to donate it instead.

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How to talk to your children about spending, saving and charitable giving

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