What I Teach My Kids About Money: Kevin McCreadie
Author: Kevin McCreadie
November 29, 2019
I’m a big believer in the importance of financial literacy – helping people make smarter choices, build better habits and make more informed investment decisions by empowering them with knowledge. I believe strongly that education is a key part of helping people reach their financial goals.
In honour of Financial Literacy Month, I thought I’d share one of the ways I am approaching financial education with my own children.
Ideally, the seeds of financial literacy are planted early in life. In our household, we’ve always made a point to talk to our kids about money. As the CEO and CIO of a global asset management firm, talking about money and investing – even at home – comes with the territory.
Now that my children are getting older (one is in university while the other is in high school) I’ve set up accounts that I use to help teach them a few basics about money.
The main lessons I hope to impart are the fundamentals of saving and investing, and the importance of giving back.
But first, some ground rules: Half of all the gains they realize remain for future investments; one-quarter goes toward the charity of their choice; and the rest can either go toward something they want, another charitable cause or an investment in something other than a stock, bond or fund.
When it comes to money management, a point I constantly drive home with my kids is the importance of taking a disciplined approach. Too often, savers can be tempted to spend impulsively while investors can be tempted to overreact to the latest news.
When saving, discipline means ensuring you commit to socking away part of every paycheque or allowance and giving it sufficient time to grow. When it comes to investing, discipline means having a clear understanding of your objective, risk tolerance and time horizon, and selecting investments that clearly fit within that framework. It also means fighting the emotional urge to panic-sell after losses or negative headlines and instead recognizing these dips as potential buying opportunities. After all, we get excited when our favourite jeans or sneakers go on sale. But for some reason, when share prices fall and companies are “on sale”, we tend to shun stocks.
When it comes to selecting investments, I challenge my children to research potential investments and discuss them with me. I’ll ask them questions to verify their understanding of the company or strategy and press them on the alternatives they’ve considered.
My passion for financial literacy at home extends to the workplace. At AGF, education is one of our pillars of social responsibility and we’re committed to fostering educational development and opportunities to invest in our future.
For example, we have a long-standing partnership with Junior Achievement of Central Ontario, supporting financial literacy programs and bringing AGF employees into Ontario classrooms. Each year to help mark Financial Literacy Month, our employees present Junior Achievement’s “Economics for Success” program to grade 7 and 8 students. The program emphasizes the advantages of staying in school and how this choice can positively impact their future. Students map their interests to possible careers and begin to learn the ins and outs of budgeting in preparation for the financial reality of post-secondary life.
We will continue to invest in financial literacy programs and support educational initiatives aimed at strengthening the financial literacy of Canadians.
About AGF Management Limited
Founded in 1957, AGF Management Limited (AGF) is an independent and globally diverse asset management firm. AGF brings a disciplined approach to delivering excellence in investment management through its fundamental, quantitative, alternative and high-net-worth businesses focused on providing an exceptional client experience. AGF’s suite of investment solutions extends globally to a wide range of clients, from financial advisors and individual investors to institutional investors including pension plans, corporate plans, sovereign wealth funds and endowments and foundations.
For further information, please visit AGF.com.
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Written by
Kevin McCreadie, MBA, CFA®
CEO and Chief Investment Officer
AGF Management Ltd.
