Help Your Kids Ace Financial Literacy
Guiding teens into adulthood often requires life lessons that go beyond the classroom — especially when it comes to personal finances. Help set your teen up for long-term success by nurturing their financial literacy. From developing good saving habits to using credit wisely, these skills can give them the confidence to make smart money decisions throughout their lives.
Create a Financial Literacy Curriculum
It can be hit or miss when it comes to what schools teach about managing finances. Build your own curriculum by making a list of things you do every day related to money — like paying bills or saving for retirement— and then consider how to share it with your teen.
Like any plan, it helps to write down the topics you want to cover and to brainstorm with family and friends about things they wish they’d known about managing money sooner. When possible, connect your conversations to real life.
For example, you could talk about budgeting when it’s time to shop for back-to-school supplies or when buying a holiday gift for Grandma.
Things to Teach Your Teens About Finances
Whether it’s pet sitting and raking lawns in middle school or a part-time job at the local pizza parlor in high school, your teen will be earning their own money in no time. Although they’ll have fewer responsibilities than an adult earner, they’ll still need to learn how to make smart decisions with their money.
Good topics to cover include the importance of savings, making a budget, planning for a future purchase and understanding credit and debt (even before they have any). You don’t have to tackle everything at once. Start with the basics — like getting your teen their own savings account to manage income from their first job — and move on to more challenging topics later, like understanding interest rates and shopping for insurance when they’re ready to drive.
Being a Role Model and Other Ways to Teach Financial Literacy
You don’t need to put on a full-blown lecture series to teach your teen about financial literacy. Keep things interesting by finding different ways to bring financial lessons into daily life.
• Educate teens through hands-on experiences like helping them set up their own bank account and showing them how to use online tools to automatically add to their savings each month.
• Engage in conversation as you perform regular, everyday financial tasks. For example, explain why paying bills on time is important while you’re sitting at the table managing your checking account or buying food at the grocery store.
• Be a real-life influencer. Don’t underestimate how big an impact you can have on your teen when they see the example you set managing income, saving for the future, and responsibly handling credit and debt.
Learning to manage your finances is as important as learning how to cook breakfast or jumpstart a dead car battery, so bring your financial conversations to the dinner table or after-school pickup. Age-appropriate, engaging financial education is one investment that can pay a lifetime of dividends.