Teach Kids About Money: Be Honest
Children are aware of money at an early age, long before they go to school. Interactive discussions—rather than lectures—are most helpful in teaching your kids about money. Allow kids to ask questions, express opinions, and have input to decisions.
Learning what topics are appropriate at the different life stages can help lead the conversations as well. This chart from America’s Credit Unions 6th edition Financial Counseling Certification Program book highlights the life stages and topics.
With young children it's better to wait until they initiate discussions; even older children may be more receptive if they ask the question. Sometimes, however, important matters require a sit-down discussion:
- Be reassuring and assess, based on the age of the child, how much they'll understand and how much detail to offer.
- If the change will affect the child, such as a cutback in the family budget, that's something that needs to be explained. Children can understand this and relate to it. Parents often are surprised at how supportive their children are when cutbacks are required. If you discuss how you'll reduce spending, children may volunteer to cut their own spending.
- Talk openly with your children about things you'd like to buy but can't afford. If you save for an item, let kids see you doing so. If you buy something you haven't budgeted for, discuss what you'll give up buying in exchange. Show that it's not just kids that have to go without—parents have limits too.
If you need additional resources on financial resource topics, your credit union is a great place to go and ask for those!
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