Parents worry their children will be worse off

Working mother in home office, worried about finance
Marina Andrejchenko / Shutterstock

A recent Pew Research Center study found people in 17 wealthy countries have a positive outlook on the global economy but still believe their children will be worse off financially than they are.

Canada ranked sixth among those 17 countries, with 68% of parents expressing this fear. The younger generations feel it too, although they do link their worries to COVID-19.

Last fall, a survey from payment-system company Interac found half of millenial and gen z Canadians say they’ve worried more about managing their finances during the pandemic than at any prior time in their lives.

Empower Your Investments with Q Trade

Discover Q Trade's award-winning platform and take control of your financial future. With user-friendly tools, expert insights, and low fees, investing has never been easier.

Start Trading Today

Children aren’t achieving traditional milestones

Unhappy Female Customer Having No More Money to Spend. Poor broke girl having financial problems while shopping
Nicoleta Ionescu / Shutterstock

What’s at the root of this worry? Experts point to a tendency among parents to measure their kids against outdated markers.

“I think for the broad populace, they use benchmarks that are familiar to them. And one benchmark that is familiar to most Canadians is home ownership,” says Mark Yamada, president & CEO of PUR Investing in Toronto.

He argues it’s not just rising home prices and a lack of cash that’s preventing young people from entering the housing market. There’s also a social component. “The reason kids are not buying real estate is not only that the price is high,” says Yamada, “it’s [because] they’re getting married later; they’re not having children.”

He adds younger generations are holding off on major commitments until they feel financially stable.

But Natalie Jamison, senior wealth advisor and associate director, wealth management at Scotia Wealth Management in Oakville, Ont., says young people may need to reassess what it means to be financially stable. “We’ve always been told you’ve made it if you can own a home,” says Jamison. “That gives you financial stability and yet the younger generations today are thinking, ‘But how is that achievable?’”

Young people aren’t armed with needed skills

Woman working on financial literacy, calculator and documents at kitchen table
Damir Khabirov / Shutterstock

That’s where financial literacy comes in. Jamison says part of her job is to educate her clients’ young-adult children about money. Doing that’s shown her many of them have no idea how to budget, how debt works or how to plan for the future.

Her observations are backed by data. A 2019 Statistics Canada analysis found millennials have a debt to after-tax income ratio of 216% — 1.7 times more than young gen-xers and 2.7 times more than young boomers.

“If there is any reason to really be concerned about the next generation, it is that they do not have the resources or the training and motivation to defer gratification,” says Yamada. And that’s a problem for millennials and gen z because those skills matter now more than ever. A large percentage of their parents’ and grandparents’ generations were able to rely on workplace defined benefit pension plans that would support them financially right up until death.

But those types of plans are rarely offered by employers today. Young people are having to initiate and manage their own retirement investments — something many seem unprepared to handle. “Future generations will need to pay more attention to saving for retirement,” says Wilmot George, vice president of tax, retirement and estate planning at CI Global Asset Management in Toronto.

That includes their pool of retirement money, he adds, because it will fall directly to them “to ensure ... they have sufficient assets to provide for them throughout their retirement.”

Unexpected vet bills don’t have to break the bank

Life with pets is unpredictable, but there are ways to prepare for the unexpected.

Fetch Insurance offers coverage for treatment of accidents, illnesses, prescriptions drugs, emergency care and more.

Plus, their optional wellness plan covers things like routine vet trips, grooming and training costs, if you want to give your pet the all-star treatment while you protect your bank account.

Get A Quote

Parents at a loss on how to help kids

indian family teaching children on savings and financial planning
wong yu liang / Shutterstock

As for how parents should help their children achieve financial success, experts are torn. It’s recently become common for parents to give children their inheritances early to help with a down payment on a house, pay for school or get out of debt.

But George argues parents must be careful because it can prevent children from learning important life skills. It can also lead them to misallocate funds and put their own retirements at risk.

“Wanting to help their kids, a lot of parents might stretch themselves,” says George. “And very quickly and very easily, parents and grandparents can find themselves in a situation where they now are struggling.”

Rather than spreading themselves thin, he says parents need to tell their kids that planning and saving early gives them the best shot to one day retire comfortably. “With millennials, you have time on your side,” he says.

Jamison adds the most important thing parents can offer is honest, open communication around finances. Taking the time to teach fundamental skills like budgeting and how credit cards work will give children their best chance at success.

And, most importantly, they can help their children redefine what success means. “The markers of financial success are: You are living within your means and you are not in debt. And the measure of success in life is: ‘Are you happy?’,” says Jamison.


Trade Smarter, Today

With CIBC Investor's Edge, kick-start your portfolio with 100 free trades and up to $4,500 cash back.

Sigrid Forberg Associate Editor

Sigrid’s is's associate editor, and she has also worked as a reporter and staff writer on the team.

Explore the latest articles

Can you pay the CRA with a credit card?

Can you pay your taxes using a credit card? Yes, but that doesn’t mean you should. Here’s what to consider before swiping for the taxman

Leanne Armstrong Contributor


The content provided on is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter. Advertisers are not responsible for the content of this site, including any editorials or reviews that may appear on this site. For complete and current information on any advertiser product, please visit their website.