It’s more important than ever to teach your children about finances, whether you’re the basics like an allowance or on more complicated matters like the stock market. Many parents today don’t know where to begin, however, when it comes to properly educating their children, and often fail to find adequate sources or instill lasting lessons. So how should you go about instilling financial discipline and savviness in your children?
While it’s never easy to teach your children about complex topics like their finances, you can find success by leveraging the digital tools they love to use every day. By relying on tips given by experts, too, you’ll quickly find that educating your kids about finances isn’t just easier than you may have thought, but something that you’ll both come to enjoy experiencing, too.
Give them the tools to succeed
Any well-rounded adult, regardless of what level of education they’ve achieved or how many jobs they’ve worked, understands that you can’t get an important job done if you don’t have the right tools for the job. That’s why it’s critical to give your kids the tools they’ll need to properly understand modern finances. While this may initially seem daunting, it’s actually quite easy; your (or their) phone and the internet alone will give you access to all of the information you’ll ever need.
For instance, by accessing the internet, your child can access all of the expertise they’ll ever need when it comes to their finances, but only if they know how to find it. That’s why you should sit down with your children and explain the benefits of critical thinking, and thoroughly explain how to independently analyze everything they read on the web to find out if it’s true.
While this may seem like quite a bit to teach your children, it’s actually what they’re already learning every day in their classrooms; from their science teachers to their librarians, your child’s educators are often teaching them how to make educated decisions based on available data, and your approach should be no different. Give them access to the trusted publications you rely on for financial advice as they grow older, and it will be even easier for them to rely on expert information.
One benefit of this is that many of today’s leading financial publications have advice specifically geared towards parents when it comes to teaching your children about finances. There exists a myriad of articles, for instance, that reinforce how critical it is that you teach your kids about money early and often, lest they grow up to be swindled by one of their better-informed peers.
Once you’ve mastered technical literacy and your children can seek out information for themselves when they have questions, you can move to covering the basics with them yourself in-person.
Make your lessons practical
Your children will find it infuriating if you merely sit them down and lecture them about the complexity of modern financial markets, and who could blame them? That’s why your approach to educating your kids about finances should be practical, and focus on the real life situations that they’ll experience themselves. Consider giving your children an allowance, for instance, as a way to show them the value in saving up money over a long period of time. If you’re lucky enough to have achieved financial independence, or are lucky enough to work from home after reaching a milestone in your career, you already understand the value of saving up and planning for the future. This should make it easy for you to lead by example and give practical lessons to your children about future planning.
Other practical exercises – like helping them do your grocery budget or even figuring out how much spare change has fallen under the coach – will go a long way towards cementing your lessons in their mind. Most children love to be active learners, and want to do something as they learn about a new topic; having them explore for rogue pennies or ration out their allowance to buy their favorite treats are great ways to involve them in the educational process.
As countless experts have already established, financial literacy is not an option; your children are going to grow up in a world surrounded by money, and will one day be adults who will have to fend for themselves. If you want to set them off on the right foot, it’s imperative that the learning process starts early, and that they understand the importance of finances when it comes to not only the global economy, but their daily lives as well.
Don’t be afraid to get on the same level as your children, and to admit when you’re wrong. It’s important that they know the world of finance is often dominated by doubt and misinformation, and that they recognize how important it is to correct one’s self after an error has been made. By employing the beloved gadgets they use every day, and by making their learning process an active one, you’ll shape your children into financial gurus faster than you ever imagined possible.