(DailyChive.com) – Would it be hard to believe a full third of American adults weren’t taught about finances growing up? For a third of a Quicken survey’s respondents, it’s true. The study also found only 13% of them somehow managed to tap into high financial confidence in their adulthood. To help break the cycle, we’ve compiled 3 solutions for helping new generations learn what too many of us wish we did when we were young.
3 Methods To Teach Children About Money
Tip #1: Make Learning About Finances Cool
At the risk of sounding obtuse, our first tip is a humble plea to make financial health a popular topic again. Because let’s face it: discussing finances is hardly “fun” these days, and most people have an outright negative feeling about it.
What can be done? Deceptively simple things, though taught at a young age, could make all the difference. Here are a few suggestions (but above all, be creative):
- Any time your child wants to connect while you’re busy with something, consider “hiring” them to assist you, and ask them what they think would be fair payback. They’ll be wheeling and dealing in no time!
- Discuss household finances with your spouse openly, and try to explain the concepts in simple, even metaphorical terms. It will stoke your children’s imagination, and they’ll think about the underlying principles behind how valuable things can be exchanged for other things of value.
- Ensure kids earn their allowance — even at a young age. It doesn’t hurt to give them things they want, but in exchange for them adding value. It’s like having a little assistant, and they’ll naturally be interested in increasing wealth. Even if they can’t do much, consistently going through the motions alongside you will give them confidence in their earning power.
Tip #2: The Cookie Experiment
No lesson about money would be complete without a sense-stimulating lesson about impulse control. The famous “marshmallow experiment” at Stanford — in which children were promised two treats, but only if they didn’t eat the first one right away — sparked enormous insight into further studies about willpower. You can try it yourself, and make any dessert a mental muscle-building exercise in wealth acquisition.
This is a fun and easy way to broach the emotional aspect of money, where overcoming mild frustrations builds willpower and gives them tangible proof of its value. Give your children material incentives to exert strong character, and without introducing a “punishment-reward” dynamic. Instead, simply offer more of a good thing than they’d otherwise receive when they exert self-control.
Tip #3: Prove That You Value Their Time
“Time is money,” it’s often said. To the extent it’s true, children are likely receiving mixed messages, as they’re urged to do many different things, but aren’t trusted to manage their own time accordingly.
Illustrating the issue are several surveys showing that high schoolers overwhelmingly want to learn about money: 86% according to Charles Schwab, and Sallie Mae matched that figure almost exactly (84%). That’s a lot of untapped motivation being largely wasted on curricula parents increasingly dislike, or even detest (at least it’s one thing you and your teenager can agree on, though).
While it’s tempting to frame teaching children about money in a highly active light, we could paint quite a different picture to summarize the point: when youth show a natural impulse to use their time productively, perhaps the right thing is to simply get out of their way. Considering many adults also aren’t financially confident, parents and children together stand to gain from taking matters into their own hands, and nurturing a passion for independent financial education.
Financial Literacy as the Monetary Landscape Shifts
In the end, children must be taught about what money will be as much as what it currently is (not to mention its history). It’s a sobering fact to realize that even adults don’t quite know where currency trends are headed at the most elementary level.
The need to educate new generations about money now coincides with a veritable explosion of potential monetary shifts, as both traditional and completely new forms of currency increase conceptions of what money truly is. As of 2023, almost half of all states have adopted, or are trying to adopt, new legislation for precious metals-backed currency. Giant financial firms have put major investments into cryptocurrencies, indicating decentralized digital currencies are not a passing fad.
If it was difficult teaching previous generations about money, it’s likely going to get even more complex in the near future. But there’s a silver lining to it all: as faith in novel and traditional monetary solutions replace anxieties over current fiscal woes, it’s likely the financial wisdom the new generations develop will be something truly timeless.
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