Talking to Your Kids About Money
One of the most important ways that you can protect your children against bankruptcy in the future is by teaching them about money early on. When children become proficient with their finances, they’re more likely to make smart decisions that help protect them in the future. Unfortunately, many schools don’t teach basic financial skills, so it may be up to you to teach your children how to be financially literate.
There are a few ways to do that:
1) Start early.
Even very young children can count pennies or learn how much simple purchases cost. The sooner the children start to understand where money comes from and how money can be managed, the sooner they can start getting comfortable around finances.
2) Consider an allowance that links work and money.
Give your children an allowance for doing chores around the house. An allowance is an effective way of teaching the basics of work. Each month, help your children create a budget so they can learn how to manage the money they do have. Help them develop a savings plan and show them how to save for purchases they want â€” such as a new video game.
3) Take your children to the bank.
Banks usually have special accounts just for children. These low-fee and no-fee accounts help your children save, and they can be exciting for kids who like to feel â€śgrown upâ€ť by having their own bank account.
4) Make finances fun.
Use videos and games to make learning about finances fun. Create a calendar and offer stickers for every week that your child saves money. Play learning games to teach basic ideas about investing.
3) Get your finances in order.
Children learn by example, too. Even if you teach them good habits, that may not matter much if your own finances are always in disorder, and you face bankruptcy, debt collection and other financial issues. Learn to set a good example by being financially responsible yourself.
4) Use online resources.
There are many online videos, tutorials and lesson plans that can help your child learn about the basics of money, investments and other financial topics. Even if you are not especially financially literate yourself, you can learn the basics and present them to your children in the way that they will understand. For example, the Delaware Bankers Association has special events and videos for your children.
Teaching your child about finances now can be one of the best investments you make in their future. Set aside a few hours this week to play some games and talk money! You just might learn something, and youâ€™ll get to spend some time with your children while you teach them vital life skills.