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(From Financial Literacy Blog) – Within the credit union movement, this month is all about educating young members by promoting financial education. The Credit Union National Association recognizes the importance of financial literacy and has been annually promoting and encouraging fiscal education and outreach efforts annually in April for years. Here are a few ways to approach discussing money with children this month:
Set Good Examples
Whether you’re a parent, grandparent, older sibling, aunt, uncle – this list goes on and on. The children in your life are probably influenced by you and the decisions you make. Kids often observe and imitate their older relatives, so it’s important that you’re setting the right example. Practice good spending and saving habits around them, and start introducing financial literacy concepts this month. If you start initiating conversations about money and practicing good fiscal habits, the children in your life may follow suit.
Break Down the Stigma
According to a recent study by Capital Group, respondents overwhelmingly indicated that talking about money is the last thing they’d like to discuss with friends or family. Instead of finances, people would rather talk about marriage problems, politics, and religion. Money is an increasingly taboo topic and will continue to be unless more fiscal conversations are encouraged. Consider discussing upcoming bills with the children in your life this month. Bring them along on your next visit to the credit union, have them count and hand over the money when grocery shopping, and openly talk about what you can and can’t afford. If they see that you’re comfortable talking about your finances, they may not develop that stigma.
Initiate Goal-Setting Skills
The ability to set goals and achieve them is an extremely important characteristic – especially for those that live healthy financial lives. Because money is easily countable and trackable, financial goals are a great way to teach children about goal setting. Ask a child in your life about what toy they would like. Instead of buying it for them, help walk them through the steps of what it will take to be able to purchase it on their own. What does it cost? Are there chores they can do to earn money? How long will they have to save for? Going through the process of making a goal and progressing toward something is an invaluable lesson that will be very beneficial to them as they grow older.
Reading this post-April? No worries – you should discuss finances with youth all year long. Children are ultimately going to need to know how to handle their money when they’re older, so it’s favorable to have them learn now while the stakes are low. Also, reach out to your local credit union and see if they offer any youth accounts. On top of the great features and perks, many youth accounts include financial education opportunities!