How to talk to your kids about money during COVID-19

Had to cancel your summer vacation plans or rethink your budget because of COVID-19? Here's how to talk to your kids about it.

“Mom! Dad! What are we doing for vacation this year?” If your kids asked you this question in the last few weeks, did you know what to say? Summer 2020 will be a strange one, to say the least. COVID-19, layoffs, less income, closures and strict hygiene measures will be a constant presence in our lives for the foreseeable future. So how do you save summer for your family, even on a very limited budget? And how do you talk to your kids about it all? Here are a few suggestions.

Talking to your kids about money, in simple terms

If your kids sense that you’re worried about your finances, they’ll probably start asking questions. Be ready to talk to them about money in a transparent way, without letting them feel your fears or insecurities.

If you or your partner lost your job, you might have to cancel your long-awaited vacation plans or put off buying a pool or that bike you’ve had your eye on. Explain to your kids why you have to rethink your plans. Make sure you talk to them about it in a kid-friendly way, taking into account their age and level of knowledge about money.

Ages 6-7

Kids in this age range can understand the basics of saving money, how people earn money and the difference between needs and wants.

Ages 8-9

These kids understand that money buys things and they’re able to compare prices before making a purchase. This is also an appropriate age to start talking to them about why someone would want to build their savings.

Ages 10-11

At this age, kids are able to understand the basic concepts of budgeting (like saving and borrowing money) and they’re able to save up for a larger purchase.

Ages 12-14

Kids in this age range are able to understand why planning a budget is useful and the risks of excessive spending.

Ages 15-17

Older teens are able to make their own budget and calculate ways to reduce their expenses.

Your kids might feel hurt or disappointed that some of your vacation plans won’t be happening, and that’s normal. But it’s important to make them aware of this new financial reality. Don’t forget to point out the silver lining—getting to try something new instead!

Being a role model

Your kids will need financial knowledge throughout their entire lives, and research shows how important it is for parents to help their kids start building good financial habits.1 The sooner you start talking to your kids about money, the smarter they’ll be when it comes to spending and saving as adults.

Teach your kids what they can do with their money

  • They can set aside and deposit money into a savings account to save up for a special goal.
  • They can buy themselves some treats.
  • They can share their money by supporting a cause that they care about.
  • They can set money aside for a time when they unexpectedly need it.

Help your kids with each step

  • For younger kids, use a piggy bank. Have them make their first purchase with their own money that they’ve saved up.
  • Open an account in your child’s name, so they can use it to deposit money and make transactions.
  • Demonstrate a positive attitude about money and managing your finances. Kids learn by example.

Get your kids involved in your decisions

If you have to change your vacation plans for financial reasons, don’t worry—you can still have a great summer. Here’s how:

  • Revisit your vacation budget as a family.
  • Encourage your kids to help find new activities that fit into your budget.
  • Keep an eye out for free local activities.
  • Be creative. If you can’t take your family out for ice cream for the next little while, consider buying a container of ice cream and making sundaes at home. Be a tourist in your own city and look through the schedule of nearby summer activities.

If your kids know they’re part of finding a solution, they’ll feel like they have a say even if they can’t control the situation. Being included in the decision will make them feel valued and help them see your new summer plans in a positive light.

Additionally, by walking your kids through the decision-making process in a way that’s appropriate to their level of financial knowledge, you’ll be helping them develop their financial skills. They’ll need these skills throughout their lives so they can be smart about spending and saving.

And if you need a helping hand, know that you can always call an advisor at your caisse. They’ll be able to help you through the more difficult times and offer you financial advice specific to your situation.

Have a great summer!

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