Teaching Kids Financial Literacy
After a few weeks on the island, my parents are heading back East today and we’re hitting the road to Victoria pretty quick this morning.
We’ve all had such a great time just hanging out and soaking up being a family, it’s a bit of a blue day around here.
So, I thought I’d pull out an oldie but goody.
Way back in June, the warm and wonderful Lara Austin over at RBC Dominion Securities asked me to write a piece on youth financial literacy for her monthly newsletter. It was a great opportunity that I’m very grateful for. So, I wanted to share the article with you now as I think most of us tend to hope our kiddos will be smarter with their loonies and toonies in their younger days than we were.
Here it is:
Are you starting to think it’s time to have “the talk” with your kiddo? You know, the one where you cringe at having to go into all of that personal, private detail about how to manage finances?
When you look into your 5-, 10- or 16-year-olds eyes, money isn’t generally the first thing that crosses your mind when you think about the tough talks headed your way.
But, that talk and the follow-up process of providing young people with the tools to become financially literate is one of the most important talks the two of you will ever have. By the time your child is 18, they will more than likely have at least one credit card and be busy racking up debt. So, getting going early is key.
You don’t have to be a financial wizard to teach your child the ins and outs of financial literacy. All you need is the willingness to put in some solid one-on-one time guiding them through the basics of managing money, and then offering tools for them to help money work for them.
Here are some tips straight from the mouths of noted financial advisers and parents around the globe to help you begin the process:
1. Start simple. Open a savings account for your tiny person (you can start them as young as 5) and set some money saving goals together to help them understand the process of how money accumulates and how putting even a dime or a quarter a day away can allow for them to buy something special over time.
2. Teach patients. Anyone who has lived with a toddler understands the theory of “now or never.” But, instant gratification is the biggest no-no when it comes to teaching a child financial responsibility. Children who understand and apply self-restraint when it comes to saving money – for something like a bike or skates – are often more apt to be less impulsive in all aspects of their lives as they grow older.
3. Work together to show to the process of and differences in Saving, Spending, Donating and Investing by using these four concepts as you go about your daily life. You can set up a house financial plan that has budgets for things like groceries, clothes and goodies. Then, take your kiddos shopping and work through the process of meeting that budget while completing a food list by comparison shopping, reading the newspaper ads and looking for sales.
If you read through these and are now thinking, “That’s really great. But, I need a hand to guide ME through the process,” I’m right there with you and have discovered some rather priceless guidebooks that make teaching financial literacy something anyone can handle.
Money Savvy Generation is first-rate in terms of how-tos, advice from money professionals as well as parents and even an on-line store. I particularly love the Money Savvy pig that gets kids off to a great start at a young age. But, whatever age your kiddos are, this site has the tools.
MSG and several other organizations also offer parenting software and Internet resources that lay out several ways of going about teaching financial literacy in your home. These tools not only aid in your organization and planning, they can give the whole family a chance to bond over the bank book – something that usually is more likely to be a source of disconnect.
Who said the piggy bank has gone the way of the dodo?
Category: Finance & Investment, THINK GREEN
About the Author (Author Profile)
Robin Rivers is Our Big Earth’s Publisher and Sr. Partner. Able to survive on coffee alone. Often can be found leaping tall buildings with the help of great friends. Predisposed to odd hats and the color orange. In love with imagination, her kids and that crazy guy who married her.Subscribe
If you enjoyed this article, subscribe to receive more just like it.
This is great info we are just implementing allowances with our kids and honestly I was just doing some internet research on it when you posted this. Thanks.
Creative Wealth International (formerly, the Money Camp) is a nationwide (and becoming worldwide) financial literacy 501(3)c nonprofit organization dedication to empowering kids and teens to create financial freedom in their lives.
The word empower means to: "To equip or supply with an ability; enable". Creative Wealth International’s mission is to "EQUIP" kids and teens with the information and tools so that they have the "ABILITY" to create financial freedom in their lives which makes them "ABLE" to live their dreams, automatically "ENABLING" them create good in the world.
Unfortunately, too many kids are being raised by parents who do not know how to manage their finances or invest their money wisely. We have been taught our entire lives to live as "consumers". Money makes the world go round, right? It does, but what most people do not understand is they are making their money go round for other people. They are providing the owners of large corporations the ability to earn, earn, earn while they are lowering themselves deeper into consumer debt, which is a leading cause of suicide, divorce and depression. We understand that no one has this agenda in mind when they raise their beautiful little children. Of course, parents just want the best for their kids, they want them to grow up and have more than they had, and be given more opportunity than they were given. But when you place a child in school, they don’t teach them about money, except for how to balance a checkbook. They don’t tell them that when they turn 18, they are going to be offered credit card after credit card, not knowing which one to pick to work for them, or how to spend wisely. They don’t tell your kids that when they graduate college, they are going to be saddled with a ton of education debt that is going to force them to join the workforce where they will trade their time for a paycheck.
WE teach kids that passive income is the key to financial freedom and you develop passive income by investing in Real Estate, the Stock Market and Business Ventures. WE teach kids about credit cards and how to pick ones that will pay for vacations and how to spend WISELY so that they can pay off the balances every month. WE teach kids about starting businesses so that by the time they are in college, they can pay for it themselves so that when they graduate they have a choice to work, or travel or start their own companies. WE teach teens how to Move Out and Stay Out! We are dedicated to raising fiscally and emotionally responsible adults that can give back to their communities, not take from them because they were never taught how to succeed.
Creative Wealth International is a Santa Barbara, CA based 501(3)c nonprofit organization. Our goal is to have Creative Wealth programs in every major city in America by 2010 and every country in the World by 2012. We know that that is a lot to accomplish but every year we meet and train hundreds of people that are just as driven as we are to change the way kids grow up. Our unique Train-the-Trainer program trains people from all walks of life to implement and teach our unique programs in their own communities.
What makes our programs so unique?
We despise PowerPoint presentations. We don’t use overhead projectors. The only tables at our events are the ones that hold the apples and pretzels. What do we use? Music, games, activities and real life simulations. What is this amazing teaching method called? Accelerated Teaching Techniques. These amazing techniques have been PROVEN to hold participants attention while they retain 90% of the information, without ever taking a single note! And guess what, they have a TON of fun doing it!
Our Train-the-Trainer program prepares individuals to teach Creative Wealth programs their communities. They master the Accelerated Teaching Techniques and at the same time, learn the curriculums and how to run Creative Wealth programs. Our participants are never disappointed in this training and have described the training as "life-changing" and "inspiring". They leave licensed Creative Wealth coaches and take with them a completely new outlook on their lives and how they have been living them. They always walk away with goals, visions and a passion for things that have escaped their conscious. We Guarantee It!
We are introducing a brand-new program, Wealth Rules! this February 15-17, 2008 in Los Angeles, CA. We are in the midst of scheduling one in Canada, Florida and on the East Coast as well. This program will be a large-scale (200 teens and parents) financial literacy event where teens will be starting businesses, participating in their own stock market, and well, we don’t want to give everything away. We are currently looking for sponsors, companies to joint venture with and people that just plain agree with our mission and want to help spread the word.
Check us out at: http://www.creativewealthintl.org or contact us at 800-928-1932
The Creative Wealth International Team