Teaching kids financial literacy may be more important than you think!
Teaching kids about money is crucial if you want them to grow up to be independent and financially responsible. As a parent, eventually, you will be glad you did. So, investing in your kid’s financial literacy education now will be a wise investment.
Teaching young kids about money is not easy for many reasons and sometimes this topic can be avoided. Many parents teach their children about money. Some parents feel they do not have enough knowledge, time, or opportunity. Although some of it is common sense, even fundamentals can be challenging.
Look for teaching opportunities
Parents can be good role models for their children, especially if they have their finances in order. Children are aware, listing, watching, learning both good and bad money habits. So, developing good money habits, teachable moments, and looking for money lesson opportunities is important. Talk to kids about items you may be purchasing, a vacation you may be saving for, let them know when you are paying bills and how you are budgeting your money. Let them know about your values and your family priorities.
The right age to start teaching kids about money
Whether they’re young kids, preteens, teenagers, or young adults, they are starting to develop knowledge and skills. Any information children learn will help build a foundation no matter what stage of life they are in. First, they start with a piggy bank, a bank account, a debit card, and perhaps an investment account.
Money lessons as kids mature
Young children usually earn money from holidays, birthdays, special occasions and maybe allowances. As they get older, they could be babysitting, working part-time, or at a retail store. Once in college maybe working on campus. At every age level, there is a way to earn some money. The foundation they are building gets more sophisticated as they mature.
Common mistakes
Don’t wait too long! Start talking about money before your child is a teenager. Make finance learning an ongoing conversation with your child. Everyone makes mistakes let them make small mistakes while they are young so there is not a lot of money involved. As kids become older, if they have no experience in managing money, the mistakes may be larger and harder to correct.
2 Responses
Hi Sandi,
Here’s an idea for giving kids an early lesson on budgeting.
When my kids were still pre-schoolers and would receive money from a relative, we’d go to the toy store. They could pick out whatever they wanted and I’d tell them the price, if it was within the dollar amount they had to spend, and if that was all they could get or if they could get something else. We’d wander the store putting toys into and taking toys out of the cart until they had just what they wanted for the dollar amount they had. Sometimes it would be one item and sometimes it was several, but it was always successful because they learned early on the value of money and the cost of products, and were happy with what they’d chosen knowing they had “purchased” it themselves.
Hi Barbara!
Yes, I agree with your comment 100 %! I also take my younger grandkids to the toy store every year for their birthday to choose a toy within a certain budget. I take my teenage grandchildren to the mall. We shop until the goal was happily agreed upon. After the shopping experience my husband and I take them out to lunch. They loved it so much it became a family tradition and my grandkids look forward to it every year.
Thank you so much for you great comment and idea! I see you are making happy memories while introducing financial literacy at the same time. Congrats!
Sincerely,
Sandi