How to teach kids about the importance of charitable giving

Mar 6, 2024

Over the next decade in Canada, approximately $1 trillion is expected to be transferred from one generation to another through inheritance. However, far too few parents and grandparents appear to have confidence that their heirs will look after this money with the necessary capability.

One of the most effective and time-tested ways to approach this problem is to introduce younger family members to charitable and philanthropic giving. Charitable and philanthropic giving has a positive effect on children. It’s been shown to make them happier, more connected with the world and more successful.

The Importance of an Early Start

The younger the child is when the discussion begins about giving, the more it becomes a matter of practice and habit that continues into adulthood—a finding that’s been validated by considerable scientific research.
Developmental psychologist Marilyn Price Mitchell, writing in Psychology Today Acts of Kindness: Keys to Happiness for Children & Teens – observed that youngsters who perform acts of kindness experience increased wellbeing, popularity and acceptance among peers.

Result? Better classroom behaviour and higher academic achievement. Some UK research – Growing Up Giving: Insights Into How Young People Feel About Charity – concluded that young people have “great charitable expectations,” especially between the ages of 9 and 11:

  • Philanthropy teaches children about worlds beyond their own experience
  • It fosters tolerance and empathy
  • Through the fundraising process it teaches entrepreneurial skills

Financial Literacy

Charitable and philanthropic giving teaches children the fundamentals of financial literacy—an important lesson for all young people as learning sound money management skills early in life can help set them up for future success. Charitable and philanthropic giving occupies a central place in discussions about spending and saving decisions, setting long- and short-term goals, and covers many other aspects of financial literacy in the young.

There’s an insightful book written by a The New York Times personal financial columnist, Ron Lieber, that addresses these matters. It’s called The Opposite of Spoiled (originally published in 2015) and is subtitled Raising Kids Who Are Grounded, Generous, and Smart About Money. A fantastic goal!

This particular book is based on a key issue: that children are hyper-aware of money, and they have scores of questions about its nuances. We encourage any parent and/or grandparent trying to raise financially literate children to read it carefully and begin to put the advice it imparts into practice.

By taking these lessons into consideration, parents and grandparents can:

  • Shape the basic financial behaviors that are increasingly important for young adults
  • Imprint lessons about what a family truly values
  • Prepare the younger generation to responsibly inherit the money bequeathed to them

Of course, there’s also the benefit to the charity, making these lessons an even larger and more significant win. If you’d like personalized advice, please reach out to our team. We’d be glad to offer guidance that reflects your family’s needs and goals.

Recent Posts

Aviso Weekly Market Pulse: July 8th – July 12th

Market developments Equities: The S&P 500 Index climbed to around 5,615 to end the week, showing signs of recovery despite the tech-led selloff in the Thursday session. Major banks kicked off the earnings season with mixed results. Wells Fargo saw a 7% decline due...

Aviso Weekly Market Pulse: July 1st – July 5th

Market developments Equities: Even with a short trading week, the U.S. stock market is approaching new all-time highs, with the S&P 500 on track for its 34th record this year. Traders are focusing on potential Federal Reserve rate cuts despite signs of economic...

The most tax-advantaged sources for a home down payment

If you’re in the market for a home, don’t leave money on the table when saving for your down payment. We’re sharing the different tools you have available to you as a Canadian first time home buyer to save in the most tax-advantaged way. In this article: Down payment...

Aviso Weekly Market Pulse: June 24th – June 28th

Market developments Equities: Stocks rallied towards new all-time highs this week as cooling inflation data strengthened expectations for Federal Reserve interest rate cuts in 2024. The S&P 500 Index touched above 5,500, led by technology stocks, while the Nasdaq...

NEI Monthly Market Insights: May 2024

Equities continue the rally, but economic paths diverge After a brief respite in April, global equities resumed the rally to find higher ground in May, as ongoing moderation of inflation and resilient economic trends continue to boost investor optimism. The S&P...

Aviso Weekly Market Pulse: June 17th – June 21st

Market developments Equities: The U.S. markets experienced a significant options expiration event known as "triple witching," with an estimated $5.5 trillion in contracts set to expire. This event is causing volatility in the stock market, particularly affecting...