April is National Youth Financial Literacy Month. Teaching your children about financial literacy can help them develop and carry financially savvy habits well into adulthood. The basics of a financial education should include guidance on spending, saving, and managing money. Ensure that your child is on the path toward a financially stable future by teaching them these basic lessons.
Teaching Young Children to Save
Kids are never too young to learn the basics of handling money. While younger kids won’t need to pour over financial spreadsheets with you, they can benefit from learning about the meaning of making, spending, and saving money. Introduce coins and paper bills to your child to help explain counting, currency, and equivalency. Encourage your kids to begin saving coins in a clear jar. A clear jar will help them visualize the savings.
If it works for your family, an allowance is a novel way of learning about money management. Consider a few of the following tips as you set an allowance:
- Set clear expectations of what your child has to do to earn an allowance. Whether they have to finish chores or keep their grades up, this will help them learn about goal-setting and the value of money.
- Set a clear amount. Give them a “raise” as they get older or take on more responsibilities.
- Be clear about using an allowance as a tool of money management, not as reward or punishment. This can help your child develop a healthy relationship with their finances and a better understanding of money.
- Encourage them to set goals on spending. What do they want to save for and how can they get there? Now is the perfect time to open a savings account and teach them about saving and contributing.
Savings Tips for Pre-teens
Framing how you discuss money with your kids can affect how they perceive money management. Encourage honest communication about money. Be forthright with your own money mistakes from overspending, not saving enough for college, or not being financially independent until adulthood. Also share your successes—paying off debts, successfully budgeting for a down payment, etc.
Encourage your children to ask questions about money. Teach your children about budgeting and include them on family budgeting for things like groceries, Holiday gift shopping, and planning family events. Explore online resources, like Kids.gov to learn more about money management together.
Important Teen Saving Plans
Now is the time that your child becomes more financially independent. Encourage them to take on more responsibilities at home and to find a job. This way they can learn, with guidance, about managing their own money.
As your teen gets closer to high school graduation, make sure that they know about the following on money management:
- Have a solid understanding of the basics of saving and spending
- Review the costs of tuition, living, meal plans, education, etc. of college
- Set up financial accounts and have an understanding of their student loan system
- Safety when handling secure financial and private information including, but not limited to passwords, account numbers, PIN, ATM transactions, and more
Free Youth Financial Literacy Sessions from TopLine
We believe that it’s never too early to talk with your kids about money, which is why we have the program Get Smart With Your Money — a financial education initiative that encourages conversation about money among your family. There are three different age-specific groups that tailor to the needs and understandings of your children:
Building Dreams (ages 5-8)
This is a baseline course about the concepts of spending, saving and sharing. It will involve storytelling, worksheets, and other fun activities.
Dollar Power (ages 9-13)
This course teaches the difference between needs and wants, planning and goal setting, saving and paying yourself first, spending wisely and gift cards. Kids will be given real-life scenarios and asked questions about the importance of saving and spending wisely.
Dollars & Sense (ages 14-18)
This course digs deeper into the concepts that were taught in Dollar Power and expands further on sound money management, checking accounts, debit and credit cards and the significance of credit. Again, students will be taught by example with real-life scenarios and thought-provoking questions.
These sessions are offered Saturday, April 22 and Thursday, October 19 starting at 9:00 AM. They will be held at TopLine’s Maple Grove Learning Center located at 9353 Jefferson Highway.
For more information, give TopLine a call at 763-391-9494 or you can register online.