You’ve taught them good manners, good eating habits, the dangers of drugs and alcohol, but a new survey is showing that children aren’t learning much about money from their parents.
According to a survey conducted for the AICPA, on average, kids are 10 years old when they have their first conversation about money. Children may not have a good understanding of where money comes from or how exactly to use it however as soon as your child shows interest it is to their advantage to begin teaching them how to handle it wisely. By doing so, you’ll provide them with a solid foundation for making a lifetime of sound financial decisions.
The National Financial Literacy Commission offers the following tips for parents in educating their children:
Start early. Require children to save some of their birthday cash and money earned in after-school jobs. Give them small jobs to earn an allowance to pay for toys or other wants.
Speak in their terms. A child might not care about money for college and may be more interested in money to buy a toy or spend with their friends. Create teachable moments around things your children care about.
Repeat often. The more you discuss good financial habits, the more likely your child is to make them a part of their daily life. Talk about saving for a big purchase, such as a family vacation, and how it might affect the budget.
Walk the talk. No matter what you say to your children about money, your actions are even more important. If you cave in easily when they make a fuss over a toy at the store, you will have difficulty convincing them to delay gratification and stick to a budget.
For more information on the survey results noted above as well as tips for parents, see the full article published by the Journal of Accountancy, Ken Tysiac by clicking here.
For more in-depth guidance on financial education visit http://www.360financialliteracy.org/.