Teaching your Kids Financial Literacy

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Everyone learns about money at some point in their life. Some earlier than others! It is important to start teaching your children about financial literacy and responsibilities at a young age.

Children learn best when they are having fun, and we can easily make money fun! The current age of your child depends on the level you want to be teaching them at. Here are some informative and creative ways to teach your children financial literacy as they continue to grow older.

 

  • Ages 2-5
    • A clear piggybank – Start using a piggy bank, but make sure it is clear so kids can see their money growing!
    • Set an example – Little eyes are always on you; from the moment they are born. If you are consistent on healthy spending and saving habits around your children, they will be much more likely follow it when they are older!
    • The value of a dollar – It is important for children to know as early as possible that things cost money. A simple way for them to learn is to have them pay for something themselves, with their own money from the piggy bank. The simple act to physically go buy something will have more impact on a child than a long lecture.
  • Ages 6-12
  • Opportunity cost – Children need to learn that if you spend money on one item, then you can’t use that money for another item. A simple lesson that will go a long way at a young age! Let them weigh their decisions and understand all of the possible outcomes they could have.
  • Commission, not allowance – When children do chores, they will appreciate the job more if they are rewarded for the job they do. Instead of giving your kids allowance for doing nothing, teach them the lesson now that they have to earn their money!
  • Importance of giving – Once your kids start making a little money, it is important they know about the aspect of giving to others. A church, a charity, or even someone you know less fortunate. This value is something that doesn’t just affect the given, but also the giver!
  • Ages 13-18
    • Responsibilities – The financial responsibility of a bank account is a big step for a teenager. This takes money management to the next level. Teach them how to write a check, manage credit cards, and the difference between checking and savings accounts!
    • College savings – If your child is planning to attend college, it is never too early to start saving. Having a job over the summer is a great way for them to make money while not in school. Your teenager will feel like they have more responsibility of their education if they are helping to pay for it!
    • Simple budgeting – If your teenager has a job and is making money, they should learn how to build a budget to properly save. Planning out your money is an important skill to learn and very beneficial if a child learns it while still living under your roof!

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