Teaching Your Kids About Money

It’s not too early to teach your children about money. Working with them early to build a healthy attitude and habits with money will help make sure they know how to manage money later in life. With children being home, and plans for a virtual school year, this might even be the perfect time to get started with the money lessons. Sounds like a great bonus elective to me. 

 

It’s common among many families across the country to not talk about money. Parents find themselves trying to protect their children from having to deal with the stress and burden of money or their experience with money and managing finances prevent them from wanting to discuss it. 

 

Not only do young people not get adequate money lessons at home but also, learning about money has not been fully implemented into curriculums. According to a 2020 report by the Council for Economic Education, less than 17% of high school students are required to take a personal finance course. However, there are some states that have made personal finance education a requirement to graduate. Although 21 states claim to require financial education, fewer states (6) have requirements that could make a difference on how much students learn about finances. 

 

Learning starts at home. According to a 2018 PBS article, children can grasp money concepts as early as the age of three. Also keep in mind that our behaviors are passed onto our children. So even if we aren’t pulling out a stack of finance flashcards to school them, we are still teaching them how to think about, respond to, and feel about money. Before you get started, take inventory of the money thoughts that you adopted early in life. 

 

Here are some pointers to help guide you as you prepare to teach your children about finances. 

 

Lead by example

If you have children, you’ve noticed how important it is to be mindful of what we do and say in front of children because they’ll imitate everything. They soak up their environmental cues and at some point give it all right back to us. So lead by example when it comes to teaching kids about money. For example use a budget and let it be known, stay focused on your family’s priorities, save, invest, and make it a point to have impactful and age appropriate conversations about it with your children.

 

Teach them the fundamentals

Teach them about the different ways in which people earn money, why saving is important, and creating a budget. In addition to talking about these topics, find ways to apply them. For example consider paying them for additional chores, encourage them to create a business, open a savings account in their name and include them in the process, and guide them through the process of creating a budget.

 

Teach them to want to learn more

Encourage them to seek knowledge and to understand the value of lifelong learning. As they grow through the phases of life it’s important that they understand their priorities may shift and their financial needs will evolve. Show them how to find the answers to the questions they may have and why it’s always important to learn more. Help them see the value in continuing to learn about money and finances.

 

Teach them about consequences and goal setting 

Helping them understand that there are consequences for every choice will be essential to helping them develop good money habits and seeing the alignment in how they help them reach their financial goals.

 

Developing financial literacy and healthy money habits to sustain you through life starts early. We can afford our children better opportunities by making time to share knowledge with them now and fostering their growth over the years. The MoCaFi app and Blog are great sources of information for helping you make better financial decisions and finding access to other resources that can help you spend smart, build credit, and do you. Check back regularly for tips and information to help you and your family along the way.

 

 

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