Want your children to get a financial education? Well, the onus is on you, the parent, because you can’t count on them learning about money matters in school, said Thomas Henske, a certified financial planner and partner at Lenox Advisors.
As only a few U.S. states mandate financial literacy classes before high school graduation, Henske recommends parents starting talking to kids about finance at home from about the age of 5 or 6.
A good place to start is by teaching your chldren about coins and small bills, Henske said, because “it’s so important you start to get them familiar with not only financial literacy terms but the vehicles we use.”
However, the approaches you use with younger children won’t necesarily work with teenagers. With small children, you can use tools like piggy banks (preferably clear ones, so they can actually see money physically accumulate), but older children and teens should work with actual bank accounts. “Have them practice paying bills, even if that’s in an online fashion,” said Henske.
Don’t forget that financial literacy lessons can be fun. Want to teach your kids about needs vs. wants? “A game you can play in the car when going on a long trip with your kids is looking at billboards or … the sides of trucks and asking, What is it that that company is offering as a product or service, and is it a need or a want?” he said.
“You have the best opportunity, because you’re in front of the child the most, to have those unbelievable coachable moments — when they see something or they ask that question — [and] to teach them about what’s important as it pertains to their money,” said Henske.
— By Kenneth Kiesnoski, associate editor