Financial Knowledge Starts in Childhood

In a recent article from The Wall Street Journal, the argument is made that financial skills and knowledge should be taught at a young age. This is because early financial lessons can have a positive impact on how children will handle their personal finance in the future. According to the article:

Regardless of whether they fully sink in at the time, having conversations about how money works early and often is the key to raising financially savvy children, financial-literacy experts say. “Money is right up there with basic hygiene” in terms of essential areas of child education, says Alexa von Tobel, founder and chief executive of financial-planning site LearnVest.com and author of “Financially Fearless.”

Your child’s earliest money-related memories have a lasting impact on how he or she comes to handle finances as an adult, Ms. von Tobel says, so be sure to set a positive tone in money discussions, even if circumstances are less than ideal. You might use your child’s request for an expensive toy as an opportunity to talk about saving for big purchases.

It is recommended that consumers have these type of conversations with their children. While children do not need overly technical conversations about personal finances, using everyday opportunities to teach basic lessons such as long-term vs. short-term saving can be beneficial to the child’s future. Doing so will help children to be more financially savvy when they reach the age in which they need to make their own financial decisions.

Read More- “Financial Savvy Starts in Childhood” (Lindsey Gellman, The Wall Street Journal)

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A rising senior at Colgate University, John is currently working as a research fellow with Consumers' Research.

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