Most generations have grown up with advice from parents cautioning them to save their money, but does that still hold up today? The truth is, building financial resilience isn’t always as simple as skipping a spendy latte.
Instead, encouraging our youth to build financial wealth in an accessible way could make all of the difference since, with time on their side, young adults can leverage real earning power through investing.
There are a number of ways parents can play an impactful role in building up their kid’s financial confidence. Here are a few simple starting points to set them up for success.
Start with an open conversation
Growing up in a household where money is a taboo subject is quite common, and can cause uncertainty and anxiety for young adults facing the sudden responsibility of financial planning. The good news, is that building a healthy parent–child relationship around finances starts with a simple dialogue that can begin at any age.
Fear of the unknown is one of the biggest barriers when it comes to investing. Start by speaking openly about your own experiences, and suggest starting a savings plan. Be sure to outline some of the basics, like the difference between a TFSA and RRSP, and try explaining how compound interest works, so they can see how to reap the benefits of starting at an early age.
Embrace the latest tools
Introduce your kid to a method of investing that speaks to their tech-savvy and time-saving generation. Robo-investing platforms like RBC InvestEase can be a great option for young people starting out in their investing journey. The low cost, low effort digital experience of robo-advisors is ideal for those who have limited investment knowledge, but would like to grow their savings over time.
Users can open an account with $0 and begin investing with as little as $100, making it virtually barrier-free. And it’s automated, as it balances their portfolio according to their goals and established risk level.
Respect their values
For a generation that prioritizes activism and social responsibility, it’s important to point out to your kid that they can make a difference with their investments, and that their portfolio can reflect their values.
With an RBC InvestEase Responsible Investing Portfolio, money is invested in companies that have been screened on multiple environmental, social and governance (ESG) factors. Think: renewable energy usage, diversity in hiring standards and policies that enforce ethical business practices. These options are great for anyone who would like to make a positive impact while investing, without sacrificing returns.
Lead by example
Lastly, one of the best ways to get your kid interested in investing is to show them how you do it. For parents of investing-age children who have yet to begin their own investing journey, the best time to start is right now.
Understanding your risk tolerance, investing goals, and how much you can contribute each paycheck are things you can establish together. With RBC InvestEase, you can do all of this and more from the comfort of your home.
Of all the knowledge we pass on to our kids, building their interest in investing is one of the best ways to help ensure they’re set up for a future of financial independence.
Learn more on how to start saving with RBC InvestEase today. Open an RBC InvestEase account and pay no management fee for 1 year1. Offer ends December 31, 2021. Click here to sign up!
1 To take advantage of this offer you must not have held an RBC InvestEase account prior to October 1, 2021. This offer applies to your first RBC InvestEase account only. Accounts opened from October 1, 2021 to December 31, 2021 using promo code AA904 will not be charged the regular 0.5% management fee by RBC InvestEase for 12 months from the date of account opening. RBC InvestEase will notify clients 60 days in advance of any changes to the fees associated with their account as set out in the investment management agreement. A weighted average management expense ratio will still apply to the ETFs held in our portfolios. For further information please refer to Pricing on https://www.rbcinvestease.com/. This offer cannot be combined with any other offers.
RBC InvestEase Inc. reserves the right to amend or withdraw this offer at any time without notice.
RBC InvestEase Inc. provides online discretionary investment management services. Other products and services may be offered by one or more separate corporate entities that are affiliated to RBC InvestEase Inc., including without limitation: Royal Bank of Canada, RBC Direct Investing Inc., RBC Dominion Securities Inc., RBC Global Asset Management Inc., Royal Trust Corporation of Canada and The Royal Trust Company. RBC InvestEase Inc. is a wholly-owned subsidiary of Royal Bank of Canada and uses the business name RBC InvestEase. In addition, the RBC iShares ETFs in which RBC InvestEase Inc. clients invest are managed by BlackRock Asset Management Canada Limited. RBC Global Asset Management Inc. and BlackRock Asset Management Canada Limited have entered into a strategic alliance to bring together their respective ETF products under the RBC iShares ETF brand, and to offer a unified distribution support and service model for RBC iShares ETFs.