Life is hard enough just trying figure out who you are without worrying about financial woes. Parents often forget to teach their kids about the key elements of being financially savvy while their kids are young enough to embrace the idea. Teaching good habits when kids are young provide a big payoff in the end. Here are a few tips that when passed on to kids help ensure they do a better job juggling the way they use money and how they save it as well.
- Live within your means. Teach kids that having the money does not mean you have to spend it all.
- Help your kids understand tax deductions before they really have to pay bills. Have mock paystubs for allowance and include things like state and federal tax as well as FICA. You can decide where you put the money from the deductions. A great thing to do with the deduction money is to put it in their college fund for later.
- Teach them early about the importance of good credit.
- Help them understand when you whip out your debit card that it’s not a credit card and how it is attached to real cash.
- Warn them about using credit when they are in college.
- Give them real-world scenarios about student loan debt.
- Help them understand what interest rates really mean and how to avoid pitfalls of falling into loans that have high interest.
- Teach them to save for items so they learn the art of patience.
- Pick up smart money type programs from those who teach programs for children.
- Find a local Junior Achievement Program so they can learn how to start and run a business.
Kids are certainly smart enough to embrace all the information noted above but if we don’t teach it, they simply won’t know it. Parents can influence great behaviors and even change their own when they remember to put kids at the forefront to help build a legacy of wealth and success not simply a debt mindset. In this current environment, we have more tools than ever to help achieve this goal and each person can take the time to make that their reality. One person, one village, one mission.