"Raising Financially Literate Children: Essential Lessons for Each Age and Stage"

According to a T. Rowe Price survey, discussing money with children is important. The research reveals that 85% of parents choose to avoid talking to their kids about saving for financial goals, with many opting to sign their children up for personal finance courses. Although courses can be helpful, children primarily take cues from their parents. Therefore, parents must teach their children to be mindful consumers, investors, savers, and givers. The following are essential financial lessons that parents can teach their children at each age and stage:

Ages 3-6: Basic financial concepts, such as the idea that you have to work to earn money, should be introduced at this stage. Parents can help children understand the difference between what they want and need by creating a collage. They can also begin to teach children self-control and patience through tasks like saving for a long-term goal, such as retirement.

Ages 7-12: As children grow older, it's essential to develop values like empathy and gratitude. Parents can introduce the idea of poverty and charitable giving by using websites like Dollar Street. At this stage, children can also open a bank account to help them understand the concept of savings and learn how to track interest earned.

Ages 13-18+: As teenagers become young adults, parents can begin to teach them about more complex topics such as investing, taxes, and credit cards. Parents can add their children as authorized users on their credit cards to show how interest accrues and how late payments affect credit scores. Parents can also encourage their teenagers to find a job to gain real-world experience and a better understanding of the working world. Finally, creating a savings plan for long-term goals can help teenagers visualize their progress and develop a sense of ownership and confidence in their future.

Overall, it is important for parents to start a conversation about money with their children, regardless of their age. Financial literacy is not just about dollars and cents; it's also about empowering children to take control of their future by developing values and making sound decisions.

https://www.raymondjames.com/krisewmg/resources/2022/04/08/raising-smart-spenders-and-savers