Teaching your child about money and finances is easiest when you start early. Here’s a quick review of what you should teach your children at each age for financial literacy for children to guide them to become financially competent adults:
• Identify coins and bills, and learn what each is worth.
• Understand that you can’t buy everything (choices are necessary).
• Save money in a piggy bank.
• Read price tags, and learn comparison-shopping.
• Do money arithmetic (make change).
• Manage an allowance, and use it to pay for some purchases.
• Open a savings account and learn about interest.
• Participate in family financial discussions about major purchases, vacation choices, etc.
• Work to earn money.
• Budget for larger purchases.
• Learn to use a checking account.
• Learn about investing — stocks, mutual funds, CDs, IRAs, etc.
• Share in financial planning (and saving) for college.
• Learn about borrowing money (interest, default, etc.).
• Use credit cards judiciously.
• Participate in family estate planning discussions.
Knowing about money – how to earn it, use it, invest it and share it — is a critical life skill. It’s never too early to start teaching your children about financial matters.
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5 Financial Lessons to Teach Your Children