Working with your children and teaching them the importance of sound money management around savings, credit and debt. Always encouraging them to practice good money habits is one of the most important lessons a parent can provide their children. The earlier we start teaching our children about the importance of wise money management, the better they will be prepared as they grow up and become adults.
We can teach them to avoid popular mistakes like overspending or the misuse of credit, and other debt. This will allow them to become smart consumers, financially secure and debt free.
You can start by reading to or talking with them about money related topics like credit, debt, investing and savings.
Have them contribute money towards purchasing an item they need.
Always encourage them to earn their own money such as doing odd jobs for family or friends, having a paper route, or working summer jobs.
While grocery shopping, have them select and compare the costs of items.
To get them started and encourage banking, start by opening a custodial account, having them make deposits and balance their checkbooks.
Teach them about the proper use of credit cards by having them understand about interest rates, minimum payments and fees.
Talk with them about investing techniques such as saving for a car or college.
As they get in to their teen years, support and encourage them to participate in personal finance education courses though their church, a nonprofit organization or bank.
Describe the negative impact credit card debt has and how it may limit financial options as they become adults.
Walk them through a complete personal financial budget so they can see and manage their monthly living expenses. Show them how to set financial goals.