While money and finances should be the top priority for all of us, there are many people who aren’t as financial savvy as they should be. I can tell you ten years ago, I was one of these people. I wasn’t taught much about money growing up, and when I became an adult, I struggled with credit card debt and overspending. After years and years of making mistakes where money was concerned, I wised up and began to listen and research to financial coaches and experts. While I am still not where I want to be money-wise, I am a long way from where I was.
Financial literacy, in my opinion, should begin in childhood. Money and finances are such an important part of life, and as a parent, I’ve made strides to teach both of my children the value of a dollar. I don’t want to them to make the same mistakes I made when I was coming up, so weekly discussions about money and the importance of saving is always on the menu in my home.
I received some fab financial literacy tips from entrepreneur, author, and self-made man Patrick Bet-David, whose made financial literacy his passion and crusade. They were right on point with that I’ve been instilling in my kids, so I wanted to share his informative tips so that you can also help your kids understand the value of being financially responsible.
Here are 7 Financial Literacy Tips For Kids and Teens:
Start a habit of saving money
Whether someone gives your child five bucks or you just got your first paycheck, whatever money they are making (or receive), try to have them save at least 10% in an account (do not touch!).
Start a budget
Help your child open up your own savings account and learn the basics of having a bank account. Help them start a budget and learn to manage it.
Teach your kids this—it’s tempting to see something we like and buy it on the spot, and that’s called instant gratification. But if you go online or wait a couple of months for a sale, that same item may cost less which saves you money.
Avoid credit cards at all costs
You should start talking to your child about credit in their teens. If they plan on buying an awesome car, buying a house one day, or being taken seriously in any business venture, their credit score will play a huge role in how much financial companies will trust your spending habits. Have these discussions and help them understand the importance of having good credit.
Focus on earning
Kids need to know that saving is very important, but if they’re not earning money, they won’t have any to save. Have them start thinking like an entrepreneur at an early age. Help them open a lemonade stand, car washing business or pet walking service. The key is to offer a service that people are willing to pay for.
People usually make the amount of money they feel they are worth, and most people sell themselves short. Teach children to have a high self-image, and they will create a world for themselves that meets that self-image.
Download an app on your phone
There are so many apps for managing your budget and savings on phones nowadays that you can track your money on the go. Get in the habit of keeping tabs on your spending habits. Kids will have more fun doing this on their phones and tablets.
Financial literacy isn’t just for adults; kids can learn how to save their duckets at an early age, and develop these skills while they are young, which can help them make sound financial decisions as they get older.