Children, at a young age, are curious, very inquisitive and open to learning. Think about the last time you were around a child and the number of questions they had about every single thing.
Due to their adventurous behavior, you can easily teach them about finances. Financial Literacy should not be tied to adults only.
Teaching children about money sets them up with the knowledge and skills they will need in the future to have their money in order.
What is the right age to teach children about money?
Children may not fully understand the value of money at a young age but teaching them consistently when they can grasp is always a good idea.
At the ages of 2 and 3, you can start by teaching them the names of coins and play store with them by setting up an imaginary shop and pretending to shop around with them.
As they progress to the ages of 4 and 5, you can introduce them to the idea of coupons and when you head out to shop ask them to be on the lookout for the products. This is an easy way to introduce the idea of saving to them.
For parents who start giving their children an allowance at the ages of 6 to 8, opening up a savings account for them is something you should consider. When they ask why they need to save money in the bank, introduce them to the concept of interest and how the bank pays people back for saving.
A great hobby to introduce them to at this age is coin collecting, this hobby instills the concept of saving in their minds.
While they progress to the ages of 9 to 16, teach them about comparison shopping, buy from different stores and compare the prices with them and discuss the differences with them. Here they will learn about brand names and their costs. And when the teenage age steps in, you can introduce them to investments, watch financial news with them and discuss with them what kind of investments they can make. The idea of budgeting is a great one to reinforce in their minds.
This is the right age to talk to them about student loans and how to steer clear from them. Speak to them about alternatives like scholarships, working part time while schooling or going to an in-state university.
As they fully conceptualize the value of money, you can also teach them about giving to charity and what percentage they should set aside for it.
Setting an example for your kids
Much as you may take the time to instill financial knowledge in your children, they will always look up to you to set the standard.
Educate yourself, the better you can teach your kids about money. Once they grasp the right way to manage their finances, it will give you peace of mind knowing they can make smart money choices.
Resources to teach your children about finances
There are a number of resources at the moment for children to be acquainted with financial literacy, ensuring that while your children are at a younger age, the resources to teach them about money are fun and entertaining. As the years go up, you can then introduce resources that require their comprehension on a higher level.
Here are a 3 resources you can use:
1. The It’$ My Money™ and Sammy Rabbit Coloring Book is perfect for kids to have fun while learning that saving is a great habit and financial workshops to teach teenagers about great money concepts.
2. It’$ My Money A guided journal to help you manage your finances (Vol 1) is designed to enrich teenagers with simple but smart financial information. It provides inspiration quotes throughout and questions to reinforce the reading
3. It’$ My Money Vol2 is the second in a series of journals dedicated to financial literacy and money management. From side hustles to college funding, teenagers can be equipped with the right financial skills with this volume.
- In conclusion, kids will always follow the lead of their parents/guardians. If you discuss money around them in a negative way, they will perceive money in such a mindset as they get older.
Kids are constantly observing adult behavior and building their actions on that basis.
If you would like to listen first hand from a parent about why it is important to teach children about money, the latest episode of The Money Exchange Podcast is what you need. Listen to it here
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Author, Patrina Dixon is a Certified Financial Educational Instructor, International Speaker and Best Selling Author. As Founder snd CEO of It’$ My Money, and 100 Women of Color alumni, she and her team are on a mission to help people transform their lives by mastering money management skills. These skills are taught through her courses, workshops and books. Her YouTube channel is gaining tracking. Follow it here
Patrina has been featured in Black Enterprise, Yahoo Finance, Real Simple, Fox61 and has been featured as a financial influencer by Experian. She attended University of Hartford’s Barney School of Business snd holds a financial management certification from Cornell University. Her most notable roles are being a wife and mom.
