When you’re a parent, you want to share your wisdom with your children.
There’s no shortage of topics to school them on.
Money should be at the top of the list.
“Financial literacy is one of the most valuable lessons parents can pass down.
Those lessons are sorely needed.
“This gives them the opportunity to earn money through their own efforts,” says Comblo.
There’s something to be said for allowances.
They create a work ethic.
“For younger kids, assign simple chores like cleaning their room.
Introducesaving for short-term and long-term goals.
“Saving money teaches delayed gratification and the importance of planning for the future,” says Yen.
Teens might prefer apps or spreadsheets to allocate their money.
Spending without keeping this concept in mind leads to the financial downfall of many.
This will help children prioritize spending and make thoughtful financial decisions,” says Yen.
How to help them grasp it?
Go on a shopping trip to thegrocery store.
Ask them questions like, “Do we need this, or is this something we want?”
For example, eggs and vegetables are needs; the Oreos and chips, not so much.
While you’re in the store, also show them how to compare prices and look for discounts.
Credit is to be handled delicately
“Credit equals borrowed money.
Give them a test run.
Let them borrow money from you to buy toys or other treats.
Explain the basic purpose of credit cards and how they should be paid off monthly in full.
“Stress that credit cards are for convenience, not financing long term,” says Smith.
Then too, keep it real.
Everyone makes financial mistakes.
“Those mistakes are a crucial part of learning how to manage finances.
Fess up to your kids and share one of your financial mistakes.
Not only do you seem “real,” but they might also talk more freely about money.
Keep lessons engaging and tied to everyday life so they develop healthy money habits that last a lifetime.”
