It’s important to teach kids financial lessons

Educational institutions often fail to instruct students about the practical aspects of managing money. According to a recent study from the University of Chicago, nearly a third of young adults were found to be “financially precarious” because they had poor financial literacy and lacked money management skills.

Financial literacy begins with early childhood education where parents can emphasize good principles of saving. Setting the foundations for wise financial strategies ensures that your children will be better equipped to handle the challenges of adulthood.

Digital money habits prevail

Most children rarely witness the exchange of physical money because the majority of transactions are made digitally, through online banking or credit cards.

It’s important to emphasize to your children that these forms of money are real. Credit cards are not “free money,” and they come attached to serious responsibilities.

However, you can also use digital banking methods to teach kids about finance and the repercussions of invisible money. For instance, budgeting apps help children gain a sense of how to allocate their money to various needs and purchases. Many of these programs are designed to encourage saving from a young age, while allowing children to track their progress over time.

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