It’s Never Too Early To Teach Your Kids About Money

Written by: Chip Brackley

Financial education is important and it’s never too early to teach kids about money. Money management is one of the most important life skills we can learn and yet it’s not really a focus in the education system.

 

Almost every decision we make as adults revolves around money, so why would we not equip the next generation with the ability to succeed?  We want our kids to succeed in every facet of life…

  • Education – we send them to school with teachers.
  • Sports – we put them on a team with coaches.
  • Music – we enroll them in classes with an instructor
  • Money management… crickets… NOTHING.

 

Money and Rocks Short Final

 

 

Day-to-Day Decisions Determine Our Direction

 

So, we need to have a plan. From the day-to-day financial decisions to the big financial decisions, we have the ability to equip the next generation with the tools to be successful. Buying the right car, buying the right house, getting married and combining two different viewpoints on money, earning an income and knowing how to save and pay taxes, being charitable. We have all navigated these waters… some successfully and others not so successfully. We have the scars to prove it. Financial education is crucial.

 

In the opinion of Warren Buffett the biggest mistake parents make is that, "Sometimes parents wait until their kids are in their teens before they start talking about managing money – when they could be starting when their kids are in preschool.”

 

Teaching your children about money doesn’t have to be complicated. You either put in the effort and time, or you don’t. And if you do, it’s best to start sooner rather than later. According to a Cambridge University study, children are already able to grasp basic money concepts at age three, and by age seven, their money habits are already set. [1]

 

Ways to Teach Your Kids About Money

 

  1. Teach them to be flexible thinkers. Help your children learn to think creatively and outside of the box. Help them learn to be problem solvers and not to give up too soon.

  2. Don’t freely give them money. Teach the value of earning money and making wise purchasing decisions. Help them understand the difference between real value and price. What is the good or service worth paying for?

  3. Guide them through the process of allocating their income. Let them work with you as you set your budgets and determine how and where you will spend your money. Teach them about saving and investing in assets.

  4. Encourage your children to do good with their money. Teach the value of helping others who may not have the same financial resources.

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Source

[1] https://www.cnbc.com/2019/07/19/how-this-finance-expert-teaches-his-kids-about-money.html

 

Chip Brackley is the Director of Atlanta for Archetype Wealth Partners. Chip is passionate about helping families experience greater clarity, confidence and contentment by connecting their wealth with their purpose. Archetype exists to help families thrive across generations.

 

Disclaimer: Our intent in providing this material is purely for informational purposes, as of the date hereof, and may be subject to change without notice. This article does not intend to constitute accounting, legal, tax, or other professional advice. Visitors and readers should not act upon the content or information found here without first seeking appropriate advice from a trusted accountant, financial planner, lawyer or other professional.

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