Resolve To Teach Your Kids About Money.

Now that the hectic holidays are coming to an end, it is time for another annual tradition: New Year's resolutions. In addition to the ones that seem to pop up every year (at least for me!), why not add one this year to teach your kids about money?

Why should you teach your kids about money?

One of the more practical life skills that does not get taught much in the school system is money management. That leaves the teaching to Mom and Dad. And the earlier you can get started, the more prepared your child will be as they grow and get more money responsibility.

But does knowing about money really matter? You bet! Take a look at the subprime mortgage crisis, the record credit card balances and the lack of savings of folks who want to retire. Individually, each financial issue has its own cause. But in total they all have one thing in common: a general issue with financial literacy and money management.

I know, I know. All of those issues are adult money problems. How can they apply to your kids when their biggest problem is how to afford the latest Wii game or an iPod? For starters, money education is a process. And it needs to start young. The "adult" problems come from adults who do not have a basic financial education. And, improving your child's money education now can help them avoid such money traps in the future.

But..but...I'm not a teacher!

Really? It seems like you have been doing a good job so far. How did your child learn to dress themselves and tie their shoes? How did they learn to brush their teeth and be kind to others? These are all life skills that you have taught them. Learning about money is no different - really.

It can seem daunting. Money is not typically one of those things on the list that parents should be teaching their kids - at least not until they get ready to leave for college. But starting young and taking it slow is a great way to make it easier on both you and the kids. Consider these ideas:

·       Start an allowance if your child is 6 years or older.

·       Start a savings plan by allocating certain amounts of allowance, earnings or gifts to spending, short-term and long-term savings.

·       Open a savings account at a local kid-friendly bank or credit union.

·       Encourage savings by paying interest or matching (if your budget allows).

·       Check out some good financial books. These can be for you as a parent or for the kids. Improving everyone's money knowledge is an important step.

·       Teach kids about the costs of everyday items. One of the best teaching tools can be grocery shopping and price comparison.

What ideas can you come up with? The goal here is just to get started - it is not to turn your child into the next Warren Buffet. Take advantage of everyday opportunities such as getting money from an ATM, paying bills or shopping. Try to make it fun and interesting for everyone...and just think how much they will have learned by this time next year!

Source: Jennifer Peek