When Is A Good Time To Teach Financial Literacy?

BY CHRIS WILLIAMS

As a parent of two young inquisitive girls ages 7 and 4, I, like many of you, are bombarded with hundreds of questions per day. It’s definitely not a complaint because it shows that they are engaging with the world around them and seeking a better understanding. Although, there are times when their questions have me scratching my head as I ask myself how to answer when it comes to some of those adult subjects. To all parents or guardians, I know that there are certain topics that can cause us to get a little squeamish, but I encourage you to initiate and embrace the discussions based around finances.  

So, when should you start having conversations with children on subjects of financial literacy? I say as soon as they start asking for money or in the case of my 7 year old, when she asked to use my debit card. I found that financial literary is primarily composed of 5 principles: Earning, Spending, Borrowing, Saving & Investing, and Protecting. Neither topic carries more weight than the other which makes them all required learning.

The dialog my wife and I have had with our oldest thus far has been focused on our family values; how we use money, the importance of saving, creating a budget and sticking to it. We have been very transparent with why we can or cannot buy things. We have celebrated together when we have achieved a savings goal and shredded a credit card or two. My daughter sits with me when I do the family budget so she sees the income and the expenses. I encourage her to ask questions, which has emboldened her to ask me when I am out shopping to say “Dad do you really need that right now?!” I guess she sees my money as her money now, in either event, I know she is learning and it gives me comfort about her financial decision making in the future.

I believe we must provide children with a strong foundation in financial literacy, if not, we leave them vulnerable to predatory lenders and run the risk of them delaying life goals or missing out on them altogether.

As an adult if you are experiencing financial challenges, I implore you seek the professional help of a fiduciary advisor. At Affinity Wealth Management we have spent over 40 years assisting the children and grandchildren of our clients to get them on the right foot.