Raising Financially Literate Children

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Every parent wants their child to have more than they had. We want them to have a better life, avoid the mistakes we’ve made, and be more successful. Because of this, we teach them manners, push them to do well in school, and pass on the values they will need to get by in life. However, unfortunately, money management is not one of the things parents teach their children. They either believe they aren’t equipped to because of their situation, feel they don’t have time, or may not even think to do it. But financial literacy is one of the most important things parents can teach their children.
Teaching children how to manage money isn’t as hard as you think. The most important place to begin is to model healthy habits. Only using cash when they are with you serves as a visual aid of the value of money. Using a credit or debit card may make them think that all you have to do is swipe a card and you can have anything you want. 

By the age of 6, you can begin giving them an allowance to help them learn how money works. It’s recommended that you give them one dollar a week per year of age ($6 a week for a 6 year old). Preteens should receive their allowance every two weeks and teens should receive theirs every money. By not giving them any more money between their allowance days, you can teach them that money isn’t an infinite resource.  You can also encourage them to set some aside for bigger purchases such as a bike. Learning how to save money will be incredibly helpful later in life.

Work ethic is another major money management lesson to teach your child. Push them to focus on their schoolwork and take responsibility for their success. If they have time, you can also enroll them in extracurricular activities like sports to teach them to work with a team as well. By developing a good work ethic early in life, they will go on to take their work seriously when they enter the workforce and know how to get paid what they are worth.

In teaching your child financial literacy, you also strengthen your own. As the saying goes, the best way to learn is to teach. You can help ensure your child’s success while increasing your own knowledge. If you start early, it will be easier but it’s never too late. Your child’s future depends on it.

By: Alecia Stanton

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