Teach Your Children Financial Confidence in 3 Easy Steps
We all know that talking to kids about money can be difficult, and teaching them first-hand about money matters may be even more so. However many adults struggle with their finances and so we want to be able to help you help your child. Here are some tips to teach financial responsibility.
Luckily, there are plenty of hands on ways to teach your kids financial responsibility. Here are five ideas to get you started:
Three in four teens turn to their parents for personal finance education, and 62 percent say their parents are good financial role models, according to an H&R Block survey. Even though you may not feel qualified to talk to your children about money, they rely on you for the information. So where do you begin?
By teaching your children the fine points of managing their financial life, you are giving them the tools to succeed in the future. Don’t make it more difficult than it has to be. Begin to instill good financial values into your children at a young age to avoid adult financial anxiety.
Be a Role Model
Watch how you talk about money with and around your kids. You want to show that you are in control of your money, not the other way around. If your 8-year-old is eyeing an overpriced item you might say, ”It’s too expensive.” But what you should instead ask is, “Do you think that is the smartest way for Daddy to spend his money? It does cost a lot,” which gives you the power over money, instead of sounding helpless over it.
In addition, mom and dad should be positive when discussing money to each other. When parents argue about finances, kids begin to think money is bad because it’s the root cause of the argument. Don’t hide your conversations about money, though. Instead, involve them in a beneficial way that includes explaining spending, saving, budgeting and using credit responsibly.
Start small conversations about money before your kids turn seven. Seek out tech tools that show how budgeting, saving and investing work. Since your kids are undoubtedly savvy with your smartphone, use it to educate them on financial matters. Bankrate recommends several apps that lead your kids in the right financial direction, including Savings Spree, FamZoo and The Game of Life.
If your smartphone is equipped with versatile and universal mobile pay options like the Samsung Galaxy S6, you can teach your children the benefits of this technology. A good place to start is with features like Samsung Pay and budgeting apps like Mint. Always keep your kids on top of their tech game when it comes to learning about finance.
Don’t forget to teach your kids how to store their earnings properly. Whether you open a bank account together or have them use a piggy bank, it helps them learn to save and understand that money needs to be protected.
Help Them Set Goals
A good time to begin helping your kids set real, long-term financial goals is around middle school. Before that, they might save up for a “Star Wars” figurine or a princess wand. Once they enter their early teens, though, they will set their sights on bigger things like a trip to the beach, a skateboard or even a car. Teach them how to set aside money and forego spending on smaller treats.
More young adults are living with their parents than a partner for the first time since the ’20s, according to new Pew Research Center data. While a variety of factors contribute to this change, teaching your children to have financial freedom starting at a young age can help keep them financially safe and keep your nest empty.