Lisa Gipson
Teach Kids About Money:
When, Why & How
It’s never too early (or late) for parents to teach kids about money. Specifically, to discuss saving, spending and borrowing money—and sharing our resources. According to Brad Benter, a financial advisor at UBS in San Diego, research from the University of Wisconsin-Madison found that kids can understand basic money concepts by age 3. And a Cambridge University study showed that key money habits, including executive function skills such as self-monitoring and delayed gratification, are set by age 7. Why Financial Conversations Are Important Most kids don’t learn money management in school. So, if parents
24 • SanDiegofamily.com • January 2022
don’t discuss it, how do kids learn? A survey by Junior Achievement USA and Allstate Foundation revealed that nearly half of all teens don’t know how to create a simple budget. And an alarming percentage of teens don’t think they’ll be ready to financially support themselves by the time they turn 24. If we want to help our kids navigate their way to financial independence (and trust me, we do), it is crucial we start money conversations at home. Here are tips and family games to help with the process.
1
Set a good example. “If you believe your child doesn’t need five pairs of sneakers, you likely shouldn’t own too many yourself in
order to have credibility with your child,” says Benter. This is a good time to have a conversation about needs versus wants. He suggests showing genuine interest in your child’s desired expenditures to foster an environment of respect and support. Parents also need to demonstrate sound financial decisions and responsibility: how to budget, save, spend wisely and build good credit. Discuss your family’s financial goals with the kids and your plan to achieve them. For regular spending, such as groceries, make a list in advance and let the kids observe you sticking to it. Discuss why you make various purchasing decisions (brand name or generic?) as you walk through the aisles.
