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Teaching financial literacy to children can be a daunting task, but introducing fundamental financial concepts now can set them up for a stable future. Instilling the building blocks of saving, spending and making money early on can help increase prepare your children to be financially wise. 

Not sure how to teach kids about money? Here are six tools you can use to help teach your kids about money.   

1. Give small children a clear piggy bank

Rather than using the traditional opaque piggy bank, use a see-through container to help young children see their savings visually. Money is an inherently abstract concept and the more concrete you can make it for children, the better. 

Once your kids start learning math, it can be helpful for them to roll the loose change from their piggy bank so they can see how it adds up to form greater dollar amounts. Physically handling rolls of coins can help children conceptualize the building blocks of a dollar. 

2. Create a budget from their allowance

Budgeting skills aren’t always taught at school, so it’s best to proactively guide your children as soon as they begin receiving an allowance. 

There are various schools of thought on an allowance. Some people think it could either be earned based on a rate of pay done for household chores. Other parents provide spending money for their children as needed. Some parents opt for a hybrid approach where you only pay for chores that are outside what is considered “normal” everyday responsibilities.

There is no hard and fast rule on how much allowance to allot each week but whatever you land on, help your child create a budget to prepare them for bigger budgeting later in life.

Using the example of the clear jars, you could mark three jars as either savings, charity, and spending. Then, work with your child to decide how much of their weekly allowance to put into each jar. The visual of the jar creates accountability.     

3. Help them open a bank account

As parents we must prepare our children to be successful in life and money management is a crucial step. One way to do this is to open a savings account. Children can see the interest rate earnings increase their savings over time and they’ll have access to real-life financial tools as they mature.

If your child is tech-savvy enough to go online, teach them how to navigate through a bank’s website and see how account statements are laid out. Similarly, having your child physically visit a bank teaches them bank etiquette and healthy financial habits, like keeping receipts and interacting with tellers. Plus, many banks have programs designed around children to make banking a fun and positive experience. 

4. Teach your teens how to make money

By the time children reach their teens, they will need to have a checking account so they can spend money with a debit card on their own purchases. This places bigger importance on how to make money. There are many jobs done for cash so that teens can see immediate earnings. Cash jobs, which in turn also add job experience, might include:

• Mowing lawns 
• Babysitting
• Starting an online business
• Shoveling snow   
• Getting a part-time job

Giving teens an opportunity to make their own money helps prepare them for adulthood and learn how to care about their finances.    

5. Play games that involve money

Games that involve money are helpful for younger children to start understanding how money works and how it is used in daily living. For children and toddlers, try playing “store” by setting up a fake storefront and having them hand over play money in exchange for goods. With older children, playing games like Monopoly introduces them to how money works.

6. Teach your kids the concept of credit

Good credit is important for many aspects of adult life such as renting an apartment or buying a car or house. Understanding the concept of credit at a young age can help your children avoid bad debt when they become of the age that they qualify for credit cards. 

Start teaching them how credit works. You can do so by showing them your credit report or discussing your mortgage or personal loans with them, if appropriate. As your teens mature into adults, start helping them prepare to build a credit score early. 

When you were a kid, you probably played board games with brightly colored fake money, ran a lemonade stand and saved your hard-earned cash in an actual piggy bank. You were so busy having fun, you didn’t realize you were learning important lessons about earning, saving, spending and debt.

Your kids might still play the occasional board game, but they’re probably more interested in electronic games. And thanks to advances in technology, you can teach kids about money with mobile, tablet and desktop apps that put a modern spin on the games you once loved.

These apps can help teaching kids about money and how it works, making your conversations about money more relevant. And some of them make real-life lessons easier to manage, too, like assigning chores to your kids and paying them with real or virtual money right from your phone.

Advanced Money Lessons for Teens

Your child’s appetite and capacity for advanced lessons in money will likely increase with each year of their life. By the time they reach their teenage years, you may want to encourage them to take on additional responsibility and learn more about personal finance. And the more your child learns about managing money now, the less likely they are to learn certain lessons the hard way once they leave home.

As you expand on concepts they already understand, consider taking a deep dive with these seven advanced money lessons for teens:

1. There’s value in hard work

An after-school or summer job can help put the value of money into perspective for your teenager. When they receive their first paycheck, they’ll be excited to gain some spending money—but it’s also a lesson about the value and reward of hard work. They’ll see their time and efforts translated into earnings, and that may help them appreciate money in ways they couldn’t previously.

A job can also help teens learn important life skills like how to write a resume and cover letter, build a LinkedIn profile, fill out an application, and prepare for an interview. Eventually, you’ll have the opportunity to teach them how to fill out a W2 and, later, a tax return.

If holding a traditional after-school job isn’t a good option for your teen, think outside the box. If they excel at sports, they could pick up a job as a referee for a local sports league. And crafty kids might embrace their entrepreneurial side with an online store. You can help them explore websites and apps that make it easy to find one-off gigs and earn income tutoring, selling crafts or sharing other unique skills.

2. Save it for a rainy day

As your teen gets older, it’s easier for them to understand the real-life consequences of unexpected expenses.

You can use day-to-day situations that apply to their lives as teachable moments about the importance of saving for emergencies. For example, you might explain to a new or aspiring driver how savings can help cover car repairs—putting them back on the road faster after unexpected car trouble.

While a parent’s emergency fund may consider a number of necessary expenses—like the mortgage or rent, student loans, or a car payment—your child’s savings needs may be less obvious to them. Work with your teen to think through potential scenarios, like car issues or a cracked cellphone screen, and help them decide on a savings goal. Even if they never need this money, working toward a goal is a great way to make saving a habit and not just an afterthought.

If your teen doesn’t have a checking or savings account, this can be a good time to help them open one. Your bank may even offer accounts designed specifically for teens.

3. Saving also makes future fun possible

Need more help teaching your teen to save? Try explaining how saving makes future fun possible. You can use short-term examples like saving for weekend activities and longer-term ones like saving for a new phone or car to drive the point home.

And, believe it or not, this can also be a good time to teach children about retirement. Once your teen is earning money, you can open a tax-advantaged retirement account in their name. You’ll be giving your kid a head start and the benefit of extra years of compounding interest. 

Pro tip: You can help your income-earning teen set up automatic transfers from their checking account to a savings account on a recurring weekly or monthly basis.

4. Always know what you have before you buy

Want to help your teen avoid overdrafts and maxed-out cards? Teach them the importance of signing in to their online bank account to check their balance and view any pending transactions.

Your teen may prefer apps to printed statements and checkbooks, and electronic transfers to handwritten checks. Work with them to create money management habits that fit their lifestyle. You can help them set up email or text alerts that send regular balance notices so they’re always in the know.

5. Use credit responsibly and pay bills on time

Credit can seem like a mysterious topic to teenagers. But you can start by explaining the importance of a good credit score as an adult. And help your teen understand how behaviors like on-time payments can help them build a strong credit score over time.

Want to help your teen build their own credit history? Adding them to your account as an authorized user is a great place to start, but pay attention to age limits set by credit card issuers. While some companies might not set one, you still want to be cautious.

As an authorized user, your teen will be linked to your existing credit card account and will have permission to make purchases. They’ll get their own card, but you’ll be responsible for payments.

Walk your kid through how and when to use their new card. Are they allowed to use it only in emergencies? Should they ask for permission before using it? For added peace of mind, see whether your card issuer will let you set spending limits for authorized users.

Getting a credit card for a teenager is something you should consider carefully, but building a credit history can be helpful to their financial future, depending on their age. If your teen starts building credit as a teenager, they may have a longer credit history than some of their peers, which could give them access to the larger lines of credit needed to make big purchases in the future. And without a credit score, they could hit speed bumps when it comes time to rent an apartment, open utility accounts or take out a loan.

6. A budget should be helpful, not dreadful

Want to help your teen build and follow a budget? Start by reinforcing how a budget can help them achieve their financial goals.

Ask them to think about how much income they have, how they’ve been spending their money, and what they’d like to be able to purchase or save for next. Then, show them how expenses can be categorized based on common purchases like dining out, entertainment, clothes and hobbies.

You can write out a budget on paper, but popular budgeting sites have visualization tools that can make this more fun and easier for your teen to understand.

7. Their financial future is their responsibility

You may be giving your teenager more responsibility. But chances are you’re still paying for some, or all, of their major expenses. Maybe they’re earning their own money—but if they’re living under your roof, they’re not fully in charge of their financial lives.

If your child experiences a financial setback when they’re young, it can be an opportunity for them to learn. And once they’re on their own, they may be better prepared to take responsibility for their financial life.

For example, if your teen damages their car or breaks their cellphone, you could have a conversation with them about whether it makes sense for them to pay for the repair themselves. If your child doesn’t have the resources and you’re able and willing to cover the repair cost up front, you could have them pay you back as they would any other loan.

Providing children with a thorough understanding of financial literacy at an early age, is vital to ensure proper money management skills later in life. Setting a realistic budget, responsibly managing credit and debt, saving for unexpected expenses, and learning how to invest will all be important life skills for every young adult to master. Unfortunately, there are many students who enter into adulthood without entirely understanding how to manage their finances properly. Financial literacy is defined as a “meaning-making process”, in which individuals use acquired skills, external resources, and contextual knowledge to accurately process information and make competent decisions in regards to potential consequences of their financial decisions. Although there are lessons to be learned from trial and error, financial literacy is about managing finances proactively and with intention. For adults or college-age students, improvements of financial literacy can be made by educating yourself through reading books about saving money and setting financial goals, asking for guidance from a financial counselor, taking classes within your local community, or finding online resources which provide tools and assistance to help make good financial decisions. Unfortunately for children and young students, financial literacy is often left out of the typical education system’s curriculum. Parents and guardians become the primary educators when it comes to teaching children the money management skills which will allow for a strong foundation of lasting financial competence.

Grades K-5

Elementary school is a fantastic time to teach children the importance and value of earning and saving money. Begin using money as a means of teaching when toddlers first learn how to count, allow children to run their own lemonade stand and yard sales during the summer, enforce good saving and spending habits with allowance, and begin explaining price differences during grocery store trips.

Grades K-1: An Introduction to Saving and Spending (PDF) – This lesson plan will help students to understand why saving money is important, and they will be able to list the benefits of saving and create a simple savings plan.

Lesson Plan: Ages 9-11 – Uncle Jed’s Barbershop (PDF) – Here, students will listen to Uncle Jed’s story of being able to save enough money to buy his own barbershop, despite some significant setbacks along the way. The students will learn about saving money, setting savings goals, opportunity cost, and segregation, as well as investigating what it takes to reach a savings goal through a card game.

Hands on Banking: Money Skills You Need For Life  – The Hands-On Banking courses include free instructor guides with classroom lessons and activities which will help students to learn through real-world scenarios and group discussions to teach financial skills.

Warren Buffett’s Secret Millionaires Club – This animated series features Warren Buffett as a mentor to a group of entrepreneurial kids whose adventures lead them to encounter financial and business problems to solve. The program teaches the basics of good financial decision-making skills, as well as some of the basics of starting a business.

Money As You Learn: Educator Tools – Money As You Learn provides teachers with Common Core aligned texts, lessons, and tasks that connect the concepts with real life applications, while equipping students with the knowledge needed to make smart decisions.

Financial Literacy for Kids – Find financial literacy lesson plans and activities for Pre-school, Pre-K, Kindergarten, First and Second grade.

Finding Fabulous Financial Literacy Vocabulary Lesson Plan – This lesson plan, created for grades K-2, introduces a variety of “fancy” words, which include descriptive economic vocabulary embedded within the text that relate to both the economic standards in social studies, as well as real-world mathematics and financial literacy.

Grades 6-8

Many middle school students have little understanding of finance and economics, however they are starting to enter the stage of their lives where they can start taking on some more responsibility. Have pre-teens and teenagers start working jobs or doing extra work around the house and neighborhood to earn money including babysitting, mowing lawns, cleaning, helping in the family business, or even starting their own mini-business. These are all excellent ways to instill the value of hard work and the importance of saving money. It’s okay to allow for some financial mistakes at this age, as this is typically the best time for children to learn from them.

What Can I Afford: Lesson Plan for Grades 6-8  – In this lesson plan, students will explore the costs of various cell phone plans based on a vignette that appears in the “show”. The lesson concludes with students comparing various types of banking accounts to determine which one will yield the highest returns if the money saved from the cell phones were placed in different accounts.

Economics and Personal Finance Education Resources – Here you’ll find award-winning and free videos, lessons, and online courses to teach about economics, personal finance, and money.

Financial Literacy Lessons for Grades K-8 – Scholastic’s financial literacy lesson plans for grades K-8 include saving, planning, goal setting, money basics, etc.

Once Upon a Dime: Grades 6-9 (PDF) – This lesson plan examines the development of modern economy on a mythical island, as it presents the basic economic concepts of specialization, barter, money, banking, and inflation.

Practical Money Skills  – Through its global financial literacy initiative, Visa’s award-winning Practical Money Skills program strives to link consumers, educators, banks, and governments to the tools and resources needed to help individuals of all ages develop their money management skills.

Consumer Jungle  – Consumer Jungle offers financial literacy games online, which will allow kids to learn more about personal finance with hands-on interactive activities.

The Allowance Game (PDF) – The Allowance Game, from Iowa State University, will allow kids to learn how to make smart decisions on saving vs. spending their allowance.

My Classroom Economy – This program allows educators to teach children financial responsibility through fun and experimental learning.

Grades 9-12

According to Jumpstart Coalition for Personal Financial Literacy, the average student who graduates from high school lacks basic skills in personal money management. In fact, many cannot balance a checkbook, and have little understanding of basic concepts involving earning, spending, saving, and investing. This is a growing problem in our society today, since there are more debt options, higher debt amounts, costlier student loans, bankruptcy age averages are starting younger, and adults are starting to save later.

Finance in the Classroom – Personal finance materials for K-12 educators, students, and parents to help prepare our youth to be money smart.

Money As You Learn – Tools for educators to integrate personal finance into teaching the common core.

Considering the importance of budgeting and saving for the future, it’s a surprise that schools aren’t more active in teaching the fundamentals of personal finance.

That means the importance of children being taught money lessons at home can’t be overstated.

Even if you weren’t taught money lessons growing up, it’s not too late to begin with your own children. Although every family will tackle this challenge in their own unique way, there are a few universal lessons that are useful for all children to learn.

To set your kids up for success, here are some things to keep in mind…

How Does Money Work?

Although our society thrives on using credit cards, plastic, and even cryptocurrency – it’s still important for kids to know what cash and coins actually look like. Even if you barely use cash, consider getting some out of your bank account in small bills and coins to teach your kids how much each one is worth.

If your kids are preschool age, play “store” with them in your kitchen and tag items in your pantry with a price tag. Give them a few dollars and ask them what they would like to buy. When they checkout, tell them how much they have leftover, or how much more money they need.

If your kids are in elementary school, ask them to help you make a grocery list.

Look through store flyers together to see what’s on sale and clip applicable coupons for things on your list. At the store, ask them to help you pick out what’s on the list. Teach them the value of buying in bulk, especially when items are on sale. Then when checking out, ask them to count out the money to give to the clerk.

For everyone’s sanity, try going when it’s not a busy time.

Another way to get your kids involved with handling money in a creative way is through board games. Consider playing Monopoly, The Game Of Life or Payday with your pre-teens and teenagers to help walk them through budgeting, investing and spending in a fun and risk-free setting.

A study done by Capital One Financial Corporation found that the more frequently kids spoke with their parents about money, the more capable they felt managing money. That means beyond just fun and quality time, board games offer parents another opportunity to speak to kids about finances.

How Do You Earn Money?

Once kids understand how money is transacted and what it can be used for, the next lesson should be in where money comes from.

Even if you believed it grew on trees as a child, this is something you want your kids to be clear on. Money is something that comes with hard work.

Sure, it can also be gifted, and at a young age it often is by family members, but the most common source of money is earned through work.

Allowance Vs. Commissions

There are generally two schools of thought on giving children allowance.

Some parents give their children a set amount of money unconditionally on a consistent basis. Children receive this money for simply being part of the household and not necessarily for completing certain chores.

Other parents give children the opportunity to earn their allowance, thereby rendering the money as commissions. That means they can earn money only by completing a set list of chores.

There are pros and cons to both of these approaches.

A pro of giving money unconditionally on a consistent basis is that it allows kids to receive money regularly and give them practice in managing it. The con of this approach is that in a study entitled “Improving Financial Literacy: What Schools and Parents Can and Cannot Do,” it was found that children who received an unconditional allowance had the lowest rates of financial literacy as well as a poorer work ethic.

On the other hand, paying out commissions is beneficial as it teaches children the direct correlation between doing chores and receiving money for those efforts. The con of this approach is that children are taught to expect money for doing any work around the house, including chores they really should do regardless of whether they are paid or not. Additionally, some children are not motivated by money and would rather be penniless than have to do chores.

If the above approaches seem to work well for your children with no negative consequences, then stick with it. However, if you are looking for a more blended and perhaps more balanced approach, try a mix of the two.

Give your children a list of chores that are expected of them without pay.

This could be making their beds, clearing the dinner table, doing laundry, or helping with the dishes. Ensure the chores are age appropriate and teach them how to do each task initially. These are good lessons for them as they grow into young adults. When they are off on their own, no one will pay them to tidy up after themselves, thus it is best to learn these habits early on.

However, you can also set aside extra chores that may go beyond the scope of everyday work to pay them for.

This could be seasonal work, such as helping out with landscaping or shoveling snow. Or it could be regular, but more undesirable tasks such as cleaning bathrooms or mopping floors. If your child is keen to earn extra money, you could find additional tasks for them to do. Use your discretion in how much and what tasks you would like to pay them for.

Part-Time Work

As children get older, they may be interested in other sources of income besides allowance or commissions. Although kids should not be expected to work full-time, there is value in having a part-time job.

If they’re interested in caring for other children, you can encourage them to take a babysitting course to get first aid and child care knowledge. Of course, ensure your child is mature and responsible enough to pursue this as a part-time job.

A study from the University of British Columbia which analyzed the data of 250,000 youth until they were adults found that teenagers who worked during the school year reaped many benefits. For instance, they were more likely to find jobs that were suited for them, develop better networks and make more money in their 20s than teens who didn’t work.

If your teenager only works during times off school such as the summer, consider this: teens who worked during the school year generally earned higher incomes in future years than teens who only worked during summers.

The former set of teens learned how to juggle the demands of both school and a job. Balancing school with a part-time job teaches teens important life skills, which can later be applied to the demands of balancing work and family.

Non-working teens will eventually learn this when thrown into the workforce as an adult, but learning it early can give your child an edge in their career ambitions as the study has shown. True or False: Are you living within your means?

Where Should The Money Go?

Once your kids have their own money, it is important for them to learn how to manage it.

The key to managing money is to learn how not to spend it all!

Many adults have trouble with this concept, and it only gets harder to break bad habits with age, thus learning good money habits at a young age is an investment for their future.

Whether money is given or earned, children should be taught how to allocate their cash wisely.

Three Jars

Instead of a conventional piggy bank, consider getting your child three clear jars.

Label them as save, spend and give.

Encourage your child to put a minimum of:

• 20% into savings,
• another 10% into sharing, and
• then the remaining 70% into spending.

But more importantly, before talking about numbers, talk to your child about the value and importance of each jar.

For instance, when it comes to saving, talk to them about saving for a rainy day and how to achieve long-term money goals.

The younger they are, the more visual you may have to get. Have your child cut out pictures of things they would like, whether it’s a new toy or experience out (such as going to an amusement park). Help them develop a financial plan to reach this goal.

You can teach them that allocating more to savings, then the immediate spending jar will help them achieve their goals faster.

Teaching your children to share and give of their resources is an invaluable lesson as well.

Help them choose a charity, church or organization that is near and dear to their heart to give to. If they are at a loss of who or what organization to give to, use this teachable moment to volunteer with them at various local organizations that need help.

You could also research organizations online to find international causes that speak to your child’s heart. This is a good lesson in helping your child see that money not only buys things, but helps people too.

Young Investors

It is never too early to speak to your child about investing.

Give them some examples with real numbers.

For example, you could use a compound interest calculator to show your child how even investing a small amount of money can result in a much larger amount when they are adults. The key is to show them the difference between a person who starts early and a person who has fewer years to invest.

Get them involved by helping them choose a few individual stocks to put some of their hard earned dollars in. It could even be a toy or a tech company they know about. Then keep up with the stocks by reading the news together to show your child how stocks fluctuate, and what external factors could be causing those gains and losses.

Keeping your child interested in investing is key.

Once your child is earning income with a part-time job and has filed an income tax return with the CRA, you could encourage them to open a TFSA (better when income is low) or RRSP account to tax shelter their investments. By contributing a small amount at a young age, this can set them up for financial stability later due to the power of compound interest.

Leading By Example

In addition to instructing your children, the best lessons are often taught through your actions. Having them see you handle and manage the family finances is invaluable.

Although it may have been taboo to talk about money, let alone involve you in family finances when you were a child, involving your children in the process is the first step to increasing financial literacy.

However, the biggest key to increasing financial literacy, and not raising ignorant children is to be a positive example.

If all your child sees is their parents shelling out their credit card for every purchase, they may think money is infinite and ever-flowing. Show them your budget and the finite amount of funds you have to work with each month for groceries.

Although some parents refuse to talk to their kids about money in order to avoid worrying them, this need not be the case.

Confidently showing your child that you have control over the finances and you know where every dollar goes due to a sound budget can give them reassurance.

Talk to your child about what you do to earn money and what happens if you don’t work. Having savings for financial setbacks such as job loss provides security for your family. These real world examples give your children an idea of the importance of saving and having a plan.

You can help your children to learn different things from the children’s books about economics and teach them about financial literacy for kids and life lessons. For more information drop comments in the comment section.

Today, we’re going to continue last week’s exercise of starting (and keeping!) a budget. Keeping a budget is THE most important activity when it comes to financial freedom. Of course, it’s also the hardest part.

Teaching Elementary and Middle Schoolers to Keep a Budget

Ask your kiddo(s) how they feel about having a plan for their money.

• Do they feel confident that they can meet their goal now that they have a plan?
• Do they feel like it would be harder without a plan?
• Why?

Also, if they spent money, took in some money, or both — make sure they write it down! When this happens, be sure to ask them how it makes them feel to write it down. Do they feel more confident?

Ask your teen(s) how they feel about having a plan for their money and start teaching teens about money, that will help them for managing budgets, and saving money.

• Do they feel confident that they can meet their goal now that they have a plan?
• Do they feel like it would be harder without a plan?
• Why?

If they spent money, took in some money, or both — make sure they write it down! When this happens, be sure to ask them how it makes them feel to write it down. Do they feel more confident?

Of course, your teen might say that budgeting feels like a hassle, don’t be tempted to dismiss or gloss over that feeling. After all, this is what keeps most adults from sticking to a budget. I recommend you acknowledge the hassle of keeping a budget.

At the same time, remind them that there is a clear and continually reproducible reward in keeping a budget. Tracking your money will lead to less (or zero) debt, as well as increase the chances your teen will meet their financial goals – as opposed to not tracking their spending or saving at all.

Teaching your Kids to Keep a Budget — For Parents:

One step to try that will help both you and your children — in the event you struggle with (or just don’t like) budgeting either — use this opportunity to track your own budget along with your kids!

We also highly recommend that you are transparent with your kids and tell them if you struggle with budgeting. Many kids appreciate the challenge of being more “adult,” and there’s not many things more challenging than keeping a budget. This activity may be the very accountability you need to more consistently track with your own budget as well.

Just as we’ve mentioned with previous lessons, relationships are inextricably linked to personal finances. What a great way to strengthen your relationship with your kids!

While many of us are working harder to pay down debt, stick to a budget, and boost our savings, a better strategy would be start on the path to financial health earlier – before we got ourselves into a right mess. According to government data, consumer debt in the U.S. totals out at an alarming $11.19 trillion. The average U.S. household owes more than $15,000 on credit cards and more than $30,000 in student loans.

There’s a definite link between how financially knowledgeable people are and the kinds of choices they make. People who are not financially literate may be less likely to invest wisely and save for the future, and may also be more likely to use high-cost borrowing options (such as payday loans and check cashing centers), get in trouble with credit cards, or experience a foreclosure or bankruptcy.

Back to Basics: Financial Literacy in Schools

Ideally, people learn financial literacy when they are young, establishing responsible financial behavior and good habits early. According to U.S. News and World Report, only 13 states make taking a personal finance course a high school graduation requirement. However, there are many organizations working to teach financial literacy to students:

• Take Charge America Institute. This nationally recognized organization develops financial education programs and policies for all ages, so students can learn to manage their finances with more skill and confidence. For example, one TCAI initiative profiled on National Public Radio conducted summer classes that instructed teachers on how to incorporate financial literacy education into their high school classrooms.
• JumpStart is a national coalition of organizations that works to improve financial literacy among youth from pre-kindergarten through college age. The organization provides classroom teachers with resources and information to improve their own financial literacy and teach it in school. It also establishes curriculum standards for financial literacy and runs national initiatives such as “Financial Literacy Month.”
• The Actuarial Foundation. This organization provides a financial literacy program called “Building Your Future” for high school and community/junior college teachers. The program includes four books, a Teacher’s Guide, handouts, answer keys, tools for instruction and assessment, and other resources to help instructors provide financial literacy education in the classroom. The program is aligned with the National Council of Teachers of Mathematics and JumpStart. Teachers can get the materials free for a limited time through the Website.
• Generation Money. This collaboration between the Consumer Federation of America and Channel One News incorporates broadcast news features, public service announcements, student profiles, money math lessons aligned with Common Core standards, classroom discussion guides, videos, Web-based learning, and other components. It teaches financial concepts such as compound interest, budgeting, credit, debt, and investing to middle and high school students.

Financial Literacy Resources in Your Community

Before you make a major money decision, such as buying a house, getting a credit card, taking out a loan, starting a family, or paying down debt, it makes sense to brush up on your own financial skills. If you’re no longer a student, you can still go “back to school” for financial education.

• Start with your bank. Many financial institutions and lenders offer financial literacy resources you can access online, through a local branch, through printed materials, or at a local community center. For example, U.S. Bank offers the Financial Genius program that provides financial education to children, adults, and small businesses, while Capital One offers the MoneyWise program for consumers and nonprofit organizations. Your local bank may have in-person classes or seminars you can attend.
• Use local government resources. Visit the website for your city, county, or state government, or contact your local Chamber of Commerce. Many list classes and other resources that can help you improve your financial literacy, get credit counseling, or access other financial resources. For example, the City of Houston’s Bank on Houston site lists several community centers offering financial literacy education, as does the Massachusetts Financial Education Collaborative. You can also check with the Department of Housing and Urban Development, Small Business Administration, and Economic Development Administration offices in your state.
• Find a community resource. Particularly in underserved neighborhoods where people may be in greater need of financial literacy education, organizations work to provide classes and counseling. Operation HOPE is one such national organization that provides financial literacy resources to inner cities. Your faith-based organization, bank, credit union, or local community center may be able to put you in touch with a local resource.
• Visit a credit counselor. If you need to get educated on reducing debt or dealing with bankruptcy or foreclosure, a reputable credit counseling organization can help. The National Foundation for Credit Counselors can help you locate one. Credit counselors also provide financial literacy education and tools, such as calculators, budget worksheets, videos, podcasts, and classes. Always check to make sure that they are a certified credit counselor.

DIY Financial Literacy

If you don’t have time to take a financial literacy course, there are plenty of helpful resources available online. The Simple Dollar is a great place to start learning about credit, debt, and money management. If you want to delve deeper, there are various non-profit and government resources at your fingertips, including:

• MyMoney.gov, the U.S. Department of Treasury’s portal for teaching all aspects of personal finance, from buying a home and balancing your checkbook to credit and saving for retirement.
• My Starting Point, a web-based program offered through the Community Financial Education Foundation that identifies your personal financial wellness and recommends a customized learning path that is unique to your needs and helps you understand the basic financial principles that best apply to you.
• The PBS program Your Life, Your Money provides quizzes, calculators, a financial terms glossary, and links to financial literacy websites.
• FDIC Money Smart is an instructor-led curriculum for various ages available on CD-ROM, computer-based instruction, MP3, and download, depending on the program you choose. You can learn at your own pace, according to your individual needs.
• USA gov. is a portal providing government information. In its “personal finance” section, you’ll find information about credit and debt, home ownership, money management, retirement, and estate planning.

Whatever age you are and whatever learning method you choose, don’t overlook the importance of financial literacy as it is important for parents to teach children about financial literacy for kids. Take steps today to improve your financial know-how, and take the guesswork out of borrowing, saving, spending, and investing so you can live a lifetime of financial security.

World Financial Planning Day presents an opportunity to focus on something everyone around the globe thinks about: ”Am I saving enough?“ No matter their language, country or customs, people want to know how they can enjoy life today while saving for the long-term. 

Perhaps one of the first questions people should ask themselves what kind of lifestyle they want to maintain in the future. This will determine, in many ways, how to prioritize savings today. 

Fortunately, there are some general guidelines for savings that can help people get started. One such savings rule of thumb is to set aside around 12 percent of an individual’s salary each year. While this may seem like a stretch goal for some, here are three helpful tips to get to that magical number.

1. Make Saving Automatic. Many investors in the U.S. have the option of saving money in a workplace retirement account, such as a 401(k) or a 403(b), which makes saving much easier. And automatic 401(k) or 403(b) step-ups allow you to bump up your savings without even having to do anything on your part. Simply sign up with your 401(k) or 403(b) provider and indicate that every January 1st (or any date that you choose) you would like to increase your contributions by one percent until you reach your goal of 12 percent.
2. Limit Your Debt. Another way to save is by avoiding too much debt. While these days it is very easy to get credit and borrow money, you must pay all that money back with interest. This can reduce your ability to enjoy and save in the future. It’s important not to think of credit cards themselves as good or bad, they are simply a tool consumers can leverage in today’s financial world of electronic payments. However, make sure you are not spending more money on your credit cards than you can pay off at the end of every month. Ballooning credit card payments can make it difficult to save for your long-term goals.
3. Focus on the Small Ways to Save Money. Typically, your biggest monthly expenses are fixed (e.g., rent, mortgage, car payments, student loan payments) and difficult to reduce unless you move or refinance. Focus on the small things like, how much do you spend on coffee, ATM fees, late payment fees or dining out? If your goal is to save an extra $100 per month, you only need to save $25/week. If you can make relatively small changes like those listed above, you’ll quickly reach your goal. Small, incremental savings can make a significant impact towards paying down debt or making progress on a financial goal. 

Teaching kids about money also an important factor, try to teach them about money management so they have not to face any difficulties in the future.

Parents would not dream of raising illiterate children – so why does it seem that to many parents, financial literacy is less of a priority?

As a Certified Financial Planner professional and mother of three, I believe that teaching children how to manage money is one of the most important responsibilities parents have. 

Living in a consumer culture where delayed gratification seems like an outmoded concept, it’s not easy to keep kids financially grounded. However, by providing our children with firsthand experience in earning, saving, and spending money, they are more likely to develop a savvy sensibility and the framework necessary to manage their personal finances as adults. 

Financial Literacy Is a Lasting Legacy
Financial literacy involves understanding fundamental financial concepts, such as compound interest, the time value of money, the use of consumer credit, diversification, tax-preferred savings vehicles, consumer rights, and more.  Having this knowledge supports our ability to make prudent financial decisions throughout life and to respond competently and confidently to the inevitable financial uncertainties that we all face.

Since financial education is a natural contributor to economic success, I am passionate about helping my children understand the value of financial stewardship. I want them to be able to differentiate between needs and wants. I focus on teaching my children sound money-management skills that will serve them well throughout their lives.

Four Tips for Teaching Kids About Money
With the goal of financial literacy in mind, consider these four strategies to help teach your children how to best manage their money. They are simple and effective, even for children still in elementary school.

1. Create a financial mission statement for your family. Solicit input from your family about what each member thinks is important. Is it eating out, taking vacations, saving for college, or all of these goals? Have an open conversation with your spouse and children to encourage them to think about the meaning of money, the challenge of earning it, and the importance of saving for what they truly value.

2. Take opportunities in your daily activities to model how you make spending decisions. By discussing money-making decisions as you shop, cook, and pay bills, you provide concrete examples that your children can model. Plus, taking the kids to the grocery store and cooking dinner afterwards teaches them to apply their math skills in the real world. For example, having them bag groceries with you at the checkout shows them how much it really costs to fill up the fridge each week.  You might encourage them to compare the costs of the meals they help prepare at home to what the meals might cost at a restaurant or fast-food  establishment.

3. Give your kids opportunities to earn money. Consider the idea of paying an age-appropriate allowance to your kids. Whether you believe that it’s better to tie an allowance to doing chores, or to give a small stipend without conditions is a matter of constant debate. Either way, an allowance is a great way to teach kids how to handle their own money.  My daughter Sarina, who just graduated from high school, has worked as a swim instructor, lifeguard, and math tutor.

Earning money has given her an understanding of how much she needs to work to pay for things she wants. This summer, she realized that by not taking a full hour for lunch, and by lifeguarding for 30 minutes during summer camp, she was able to earn an extra $10 a day! While the extra money was a tangible benefit, Sarina’s extra lifeguarding was valuable to the camp director, too, because it enabled her to accomplish other tasks.

4.  Allow children firsthand experience in saving and spending their own money.  Open a savings account for your children early, and consider allowing them to manage the records. They can monitor their savings activity over the years. By the time they become teenagers, the benefit of saving regularly over time will be apparent, because they will have some money to spend on clothes, food, and friends –and still save for college. And by the time they head off to the university of their dreams, they will be more likely to have a savvy sensibility about managing their expenses.

One of the hard parts of giving children some control over their own money is that they are sure to make some mistakes. It is important not to rescue them from every mistake! Children need the benefit of making their own decisions. By learning from their mistakes, they become adults who can manage their money well.

You can help your children to learn different things from the children’s book and start teaching kids about money. It will be beneficial for them in present as well as in future.