Teaching children about money, finances
Money management tips for parents by the FDIC
PEMBROKE PARK, Fla. – From preschool to college, here are some tips for teaching your kids about money:
Whether you are 4 or 24, knowing how to properly manage your money is an important skill to have.
Pre-K to Grade 2: "Earning and Saving"
· Parents should use bills and coins in front of their children when making purchases every once in a while to teach children about the different values.
· To reinforce the concept of bills and coins, imaginary games where children pretend to be at a store or restaurant are helpful
· Have two separate piggy banks, one for money to save and one for money to spend, to learn saving and spending work in tandem
Grades 3-5: "Creation of a Comparison Shopper"
· Children at this age should be taught how to think before they buy; know when they need something rather than want something.
· Help your child create a budget
· Show your child bank statements to see how money decreases as you spend
Grades 6-8: "Tips for the Teen Years"
· Teach your teen if they work more, they can earn more. Encourage them to become camp counselors, or obtain a part-time job.
· Teach them to save for long-term goals, such as college or a car
· Teach your teen about fraud; with social media and online banking, teaching about privacy on the internet at this stage is crucial
Grades 9-12: "Understanding large purchases, interest, credit"
· Help them realize career goals
· Explain financial responsibilities of large purchases, such as a car, which come with insurance, maintenance and fuel costs among others
· Explain benefits and risks of where your child places their money, whether it's safely in a bank, or in a stock.
College Students: "Money Management"
· How to choose a bank, comparison shop, hidden fees
· How to use credit cards responsibly, impacts of interest
· Student Loans: research, compare rates
The FDIC says it is never too early or late to incorporate financial concepts into a child's life. In fact, the FDIC encourages families to partake in regular conversation about money-related topics so you can be more confident that your child will grow up to be financially responsible.
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