83% of U.S. adults said parents are the most responsible for educating their children on financial literacy.
At the same time, only 15% of parents said they spoke with their children more than once a week about household finances, 13% said once a week and 16% said once a month. Some 24% talk to their children less often and 31% never do.
What are some concepts you can talk to your children about regarding finances?
These include but are not limited to:
How a Bank Works (how ATMs work, cashing in a cheque, the difference between debit and credit cards, how interest works)
How to Spend Money Smartly (if the purchase is large, you may tell them to think about the purchase before going through with it – what is it offering them, is it necessary, is it a smart purchase or a waste?)
How to Create a Budget (have them budget their expenses, even if they’re only small purchases)
How to Save Money (when they start working a job, teach them to save a portion of every paycheck)
How to Earn Money (be sure to sit down with your children and explain ways they can start to make their own money to them)
Another issue that’s become common is parents not knowing financial facts themselves:
The U.S. Bank study found that 77 percent of parents talk about saving money in general and more than half talk about building and maintaining credit.
51 percent of parents think the money in your savings affects your credit score, and 52 percent think debit cards and checks help your credit score — both of which are false.
A lack of knowledge leads to parents teaching their bad habits to kids. To avoid this, focus on fact-checking yourself before teaching your children finance topics.
Ultimately, adults with children should start teaching their children the value of money as soon as the children can understand basic math such as addition and subtraction. Whether that be through games or letting them make small financial decisions, it’s a start for their financial literacy.
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