It’s never too early to talk to your kids about money. Financial expert John Caserta, or Caserta & de Jongh LLC has some tips for parents.
The development of financial literacy programs throughout US schools has come to a stalemate.
According to a 2018 study by the Council for Economic Education, only 17 states require that high school students complete a course in personal finance while less than half of all states mandate a course in economics. And over the past several years, the number of states with such requirements has remained unchanged.
Until these programs become a core subject for students, there are a number of ways that parents can help raise financial fit kids.
Start Early
One of the biggest mistakes in teaching children about money is waiting. Research by the Centers for Disease Control and Prevention has shown that by age three, children are learning to count and by age 5, children are beginning to understand the concept of money. During these formative years, parents have the opportunity to introduce money by using a piggy bank to which they can add birthday or holiday money. As children grow older, parents can begin to introduce the concept of saving or spending that money.
Talk About Money on a Regular Basis
Money is often a taboo subject. But research conducted by T. Rowe Price in 2017 showed that parents who talk to their children about money at least once per week tend to have children who feel “smarter” about their money. As children start to enter their tween or teenage years, giving them an allowance for doing chores can help instill the concept that money is earned. But more importantly, allowances can help facilitate conversations about budgeting and how those earned dollars saved, spent, invested, or
Practice What You Preach
Some argue that whether you talk to your children or not about money, they are absorbing your attitudes towards it on a daily basis. Dr. Sean Brotherson, a Family Science Specialist at North Dakota State University, argues that children base attitudes and values about money on how their parents treat money. Brothers further suggests that parents can help children understand money matters by letting them participate in discussions about family finances.