Understanding and practicing financial literacy as an adult might very well be a necessity that’s hard to get around. Without the right information, it’s hard to buy a house, invest in stock/real estate or even prepare for retirement.
It might be easy to brush off teaching younger generations, i.e., kids financial literacy, because they’re not “at that age,” but as we all know, time waits for no one, so the sooner they get started – the better.
Where to begin
If you’re feeling overwhelmed with where to instruct your kids on smart money habits, it’s always best to start simple. As a kid, one way I learned the basics of money management was doing my chores and getting an allowance. Every week I was responsible for taking out the trash and maintaining my bedroom, and then I eagerly awaited spending my “wages” on whatever I wanted. Well, not exactly — I was taught what to do with my earnings, and was encouraged to “pay myself first”, give some to my local church/charity and (since my only responsibilities included finding the latest Baby Phat tee) spend whatever was left on what I wanted.
If older kids want to save up for a car or put some money toward their college tuition, it’s always a good idea to encourage them to take on a part-time job. Especially if they have a good hold on their grades, they can afford to steal a few hours away each week and work for their local grocer. The good part about making W2 income is that they can soon open up their own investment account and take small steps towards their financial futures.
Certainly, there are numerous ways to guide your children toward financial peace, but the best thing to do right now is to start the process which leads to their financial future.
Why does it matter
Now you still may wonder why it matters to teach your children how to have a healthy mindset toward their finances, but the numbers don’t lie. It might be the rising student loan debt, which at $1.6 billion has more than doubled since 2008’s $600 million. It doesn’t help that 18-year-olds are encouraged to “sign away” their lives and aren’t given a full explanation of what they’ll owe and how they can pay post-graduation.
Teaching your children early is important because it might ensure that they open up a savings account, gain responsibility when using credit and make full use of future work benefits.
It also doesn’t hurt to put money away because they will one day want to be where you’re at: have their own home, go away to college, travel freely, and have a strong retirement account. CEO JackieTrust of Stuff&Stock understands that these life goals don’t easily start later in life because small steps taken while you’re young can make adulthood a “whole-lot-easier.” Her Stock Investment Group and Book Club wants to remove all the confusion related to financial literacy and truly prepare your children for their future. Why?
Because financial literacy doesn’t have to be some kept secret for some children to get ahead in life. All children are deserving of stability and a bright future once they get started and take small steps now.