Teaching Kids About Money
Teaching your child to save, spend, and invest their hard-earned money is a valuable lesson that will help them through adulthood. No matter their age, it is never too early to start teaching your child good money habits.
This age group is the group that is watching and soaking in everything you do. The best thing you can do for them is to set a good example financially. Talk to them about coins, the value of things, what money is used for, and how money is earned. Take the extra time to have them pay for an item with cash instead of your credit card and begin introducing them to the concept of wants versus needs. Small, simple money habits like these will set the foundation for their future.
At this age, kids are even more aware of money as they are introduced to allowances. As they start to earn more money, it is important to work with your child and help them set a short-term financial goal, and if you have not already done so, open a youth savings account. Make sure to carve out some time to bring your child by the credit union on a regular basis too; this will help them create a good habit of saving.
Also, impulse buying at this age becomes more common as well. Instead of giving in, let your child know that they can use their money to pay for that certain item but if they do, they will not have money to buy other items down the road. By doing this it will help them weigh their options and understand the different outcomes between spending or saving.
As your child enters their teenage years, it’s important to reinforce the saving habits that you have already introduced by helping them create a very simple budget. To help illustrate even further, have your child sit down with you and look over the bills that you pay at home. This not only will help them budget when they are on their own, but also give them an idea of how much things cost.
Teens are also at the age where they can start taking responsibility for their own bank account. At CTCU, we offer a REAL Teen Checking Account where teens are given a real debit card and access to view their account on mobile or online banking. There is no minimum balance and no monthly service fee, and parents can monitor all spending, set up automatic allowances, and control spending limits. It’s a great first checking account to give teens a little bit of freedom and parents that peace of mind.
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