Is Financial Literacy in Your Child’s Curriculum? 4 Tips to Help
Holly Wanegar, CFP®
Associate Vice President & Wealth Advisor
Parents share a lot of knowledge with their children in the hope that the information will help them grow into successful adults. But there is one topic that most parents try to avoid at all costs. And no, it is not what you are thinking.
For many parents, the idea of having the “money talk” with their kids is terrifying. The biggest reason parents avoid the topic is that they don’t believe they know enough about money themselves and fear that they will give their children the wrong information.
Although discussing the topic of money with your kids can be uncomfortable, it is a necessary step in their growth and development. Few schools teach their students how to handle money the right way. Without learning money management skills at home, your kids might be in for a few surprises when they get older.
Are you worried about your children’s money skills? Consider the following four tips for teaching financial literacy to your kids.
1. Let Kids Experiment
One effective way to help kids learn how to budget is to give them a chance to make mistakes on their own, in a safe environment so they don’t get into too much trouble. A small allowance each week is the perfect incentive for children to learn how to budget. Do they want to blow this week’s money on candy and a cheap toy or save up a few weeks’ worth to get something they really want? Of course, some children will still be impulsive and want to spend their cash right away, but it’s better for them to learn to make mistakes with $10 than $10,000.
2. Include Children in Household Budgeting
Do you have a shopping or entertainment budget each month? Try including an older child in budget planning for the next month. Kids learn their lessons quickly when they have to stay home bored for two weeks because they blew the entertainment fund during the first half of the month.
Another great idea is to set a grocery budget for an upcoming trip, make your week’s list, and then take your child to the grocery store with you. As you place items in your cart, have your child add up the cost of each item until you hit your limit. This is another great exercise that will teach your children how to make choices based on limited funds.
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3. Gameify It
Turn budgeting and saving money into a game. Give your shopping lists to your younger kids and let them search online or in the newspaper for coupons and sales. Perhaps you might promise to put a percentage of the money they save into a piggy bank for them to purchase something special down the road. You could even encourage older children to learn lifelong investment skills by helping them get started in a stock trading simulator, such as The Stock Market Game.
4. Make Them Earn It
Knowing how to save, invest, and spend money is important, but one of the best things you can instill in your children is a good work ethic by allowing them to earn money on their own. Whether your teen works part-time at the movie theater or your little ones start a lemonade stand, the willingness to work hard and be rewarded that accompanies such endeavors is one of the most valuable financial lessons you can pass on to them.
National Teach Children to Save Day, celebrated annually on April 27th, serves as an excellent reminder for parents to prioritize financial literacy education for their children. This day aims to raise awareness about the importance of instilling sound money management skills in young minds from an early age. By celebrating this occasion, parents can seize the opportunity to engage their children in interactive and educational activities that foster a healthy understanding of saving, budgeting, and responsible financial decision-making.
It’s never too early or too late to improve your financial literacy, or to create a strong and strategic financial plan to achieve all of your goals. Reach out to our team today to schedule a complimentary consultation, where we'll work together to develop a strategic financial plan tailored specifically for you, through our Plan Well. Invest Well. Live Well.™ strategic process. Call (860) 928-2341 or book a consultation on our website.
Authored by Associate Vice President, Wealth Advisor Holly C. Wanegar, CFP®. Securities and advisory services offered through Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. These materials are general in nature and do not address your specific situation. For your specific investment needs, please discuss your individual circumstances with your representative. Weiss, Hale & Zahansky Strategic Wealth Advisors does not provide tax or legal advice, and nothing in the accompanying pages should be construed as specific tax or legal advice. 697 Pomfret Street, Pomfret Center, CT 06259 and 392-A Merrow Road, Tolland, CT 06084. 860-928-2341. www.whzwealth.com.
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