As a new school year approaches, many families are preparing for new expenses. Beyond school supplies, there are technology fees, lunches, club expenses, and the daily temptations of vending machines and in-app purchases for kids with access to mobile devices.
Money Conversations to Have
Only 25% of U.S. parents who live with children say they talk with their kids about finances, according to Forbright Bank‘s recent survey of more than 1,800 U.S. consumers. Parents should have deliberate conversations about finances with their kids to help them build money confidence.
Some money conversations to have with kids include teaching them about the different denominations of bills and coins, how to count and divide money, and the importance of saving. Parents can also give their kids opportunities to earn their own money by doing chores or getting a small allowance.
Older kids can learn about the power of compound interest with a savings calculator, and parents can help them set weekly or monthly savings goals. It’s also essential to teach kids about the importance of budgeting and prioritizing needs over wants.
Parents should also discuss their expectations for what their kids can buy and how much they can spend, especially if they have access to a mobile wallet for purchases at school or during after-school activities.
Sharing Financial Decisions
Financial decisions are personal, and it’s a good idea to share them with kids. Parents can explain their choices, such as choosing the more expensive laundry detergent because it has fewer harsh chemicals, to help kids see money management in action.
When kids ask for something that parents can’t or won’t buy, they should give more insight than a simple ‘no.’ They can say, ‘We have other expenses right now,’ or ‘It’s not a wise use of our money right now,’ with a basic explanation to help kids understand the value of money.
Parents can also share their own experiences with money, both good and bad, to make an impact on their kids.
Protecting Kids from Scams
Kids are not immune to online financial scams. Scammers may reach out to kids through texts, social media, and gaming platforms, hoping to gather parents’ financial information or use kids’ information to open credit cards or take out loans.
Parents should talk with kids about how scammers gather information and teach them to watch out for common signs of a scam, such as suspicious emails or messages asking for personal information.
Original reporting: El Paso News (HLL/CB) — read the source article.
