My kids are still young (at the stage of learning to count money, make change, etc.) yet we take every opportunity to teach them the basics of handling money. Like lots of other kids, they have a bank where they put long-term savings (like a new bike), short-term savings (like a new game), and giving (where my daughter puts most of her money). We also talk about the price of items while shopping, the impact of advertising, etc. A couple months ago we even videotaped them answering the question: where do we get money to eat, pay for our house, and so on? Their answers were hilarious!!!!
This piece from MSNBC gives . Before we get to those, let's cover a few of their quotes that I thought were particularly interesting:
“Financial awareness is now key at an earlier age because young kids are becoming more aware of consumer issues, and marketers are responding to them,” said Brent Neiser, director of collaborative programs at the National Endowment of Financial Education (NEFE) in Denver. “Cell phones for 8-year-olds is a perfect example. Companies are trying to capture market share and brand affinity at an earlier age than ever before. That results in young kids making spending decisions earlier, but they’re still not learning how to save for the long term.”
And it certainly doesn’t help when they see the typical financial skills of their elders: The U.S. savings rate is at an all-time low, bankruptcies are at near-record highs and the average household has $9,000 in credit-card debt.
Ha! They've got that right! Many of today's parents didn't learn much from their parents regarding money -- and what they did learn was not that great. (I know, there are exceptions -- don't kill me in the comments.)
In addition, kids aren't learning much at school -- but things are starting to change:
Personal finance education for kids has not been too high on the priority list for schools or states, but that is now changing. Only 12 states require students to take a course about basic finances to graduate high school, but another 12 have pending legislation. Texas is the biggest and most recent state to mandate the requirement starting this fall.
David Bach talked about his desire to help kids learn about money in the third part of my interview with him (scroll to the end). It's a good cause to get behind.
The article goes on to give a thought all parents need to consider:
Still, like with most lessons, children should be learning the big ones at home. Parents need to lead by example, even if that means cleaning up their own financial act, said Foster. “It’s like smoking and telling your kids not to smoke. If you want to make them save, learn about investing and pay their credit card off every month, you need to do that too. If you do something different, that defeats the purpose.”
Yep. Kids won't do what you say, they'll do what you do.
Finally, here are MSNBC's nine tips for teaching children about money:
1. Don’t teach, just talk.
2. Get them a piggybank – or a spending account.
3. Give them a goal.
4. Monitor their use of plastic.
5. Have a “Family Money” night.
6. Tone down the consumerism.
7. Use extracurricular activities.
8. Turn them into investors and donors.
9. Make them work for it.
My thoughts on these:
1. Good point. Be natural and just share what you know.
2. As I said, we have one for each child.
3. We have goals: my son is saving for a bike while my daughter is saving for...what is it again she's saving for?
4. My oldest is 9. Needless to say, we don't have credit cards for either of them.
5. Good idea! I like this one a lot.
6. As you might imagine, we're not big spenders in our house anyway. ;-)
7. I haven't seen many of these opportunities. However, the kids did play Life the other day -- it made my daughter realize that you can't make much being an artist. ;-)
8. We've got the donor part down -- investing will come soon.
9. Of course. They need to learn that money is made/earned, not a right for just "being".
Any tips you can share with the rest of us? I'd love to learn something new that works well.
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