Tips for Teaching Kids About Money | St. Johns Bank
Teaching your children about finances may not come naturally, especially if your parents never had the “money talk” with you.
Why is it important to instill good money habits in your children? It’s a topic that will be learned somewhere, and it’s better that beneficial habits are learned rather than habits that will put them in a financial hole.
Here are a few tips for talking to your kids about money and instilling good financial habits right from the get-go:
Children can grasp the concept of money much younger than you may think. By age 3, children begin expressing interest in coins. Around this time, you can introduce coins and let toddlers sort or play with them.
Kids won’t understand financial concepts such as budgeting, but they will begin to comprehend that the coins are different from one another.
Utilize Teachable Moments
Do your kids have a piggy bank where they keep spare change they find? This is a great opportunity to have them purchase their own items using their own money!
When your children ask for a toy, let them know it costs money. Help them count out the change or bills from their piggy bank, let them pick out their toy and have them pay the cashier themselves. This simple transaction can help them better understand the concept of exchanging money for goods.
Keep the Conversation Going
Talking with your children about money is not a one-and-done scenario. Be sure to continually discuss different financial topics, such as credit cards, budgeting and debt, in an age-appropriate manner
Be the Example
Children are sponges and they learn best from example. Ditch the do as I say, not as I do mantra and learn to walk the walk instead. If you’re trying to better your own poor financial habits, this can be a challenge—but it’s worth it for everyone!
A great way to portray healthy financial habits to your kids is to keep a budget and discuss it. Be honest with them about your previous financial mistakes and talk about ways to improve your finances.
If you’re consistently living above your means and utilizing credit cards, kids will eventually take notice. Instead, work toward making smart financial decisions regularly to show everyone in the household that it’s possible to better your finances one step at a time.
When you’re ready to open a savings account for your child or build an emergency fund in a separate savings account for yourself, we are here to help! Visit our website today to learn more about our financial services.