Raising Financially Savvy Kids

Financial literacy is the ability to make informed financial decisions. It’s about understanding how money works, how to create a budget and stick to it, how to save for emergencies and long-term goals, and how to manage debt.  Financial literacy is the knowledge, skills and attitudes that enable an individual to make sound financial decisions. As per research conducted by Welham School Dehradun It is a process of learning about money management and understanding how to use the money to meet your needs and the needs of your family in the present and future.

Financial literacy starts with education—and not just about money. It’s about learning about yourself and what your goals are in life so that you can make decisions that will support them.

Also Read: Importance Of Online Education From Kindergarten To Class 12

                                   How To Raise Financially Savvy Kids

The generation of students entering college today is the first to have grown up in an economy that’s been in recession since they were born. That means they’re going to enter the workforce with a lot less money than their parents did, and they’ll need to be financially savvy if they want to get by.

Schools can help students become financially savvy by teaching them how to budget, how to save money, and how manage debt. This can be done through lectures, but also by providing opportunities for students to practice these skills in real life.

Also,  Parents play a crucial role in teaching their children financial literacy.

In many ways, parents are the first teachers of their children’s financial literacy. They can guide them in making good choices about how to spend their money, whether it’s on a toy or in the stock market. They can help them understand what it means when they’re told that “money doesn’t grow on trees,” and make sure they know what they have to do to earn more money.

Parents should also teach their children about the importance of saving money and investing it wisely. If they don’t, they could end up with a lot less than they would have if they’d started saving earlier on in life.

• Kids need to be taught about expenses and income

Kids need to be taught about expenses and income. They should also be taught how to save, spend wisely, and make smart financial choices. This will help them become financially independent adults who can handle the responsibilities that come with having money.

If you want your kids to be financially savvy adults, start early by teaching them about personal finances from a young age. Show them how much money you have in your wallet or purse and explain why you’re saving or spending it.

• Kids need to be taught the difference between needs and wants

Kids need to be taught the difference between needs and wants. This is one of the most important lessons you can teach your kids, and it’s something that will serve them well for the rest of their lives. A lot of parents try to get around this by just putting things on layaway or ordering from catalogues instead of going into actual stores—but that doesn’t make a lasting impression on your kids’ minds.

If you want them to understand how money works, you have to take them shopping and show them exactly how much things cost and what they can do with the money they have in their wallets. You might even want to let them carry their wallets around with them after they’ve earned a certain amount (usually around 10 or 11 years old).

 Teaching kids the difference between needs and wants is an important part of managing their money. If you don’t teach your kids what a need is, they’ll have no idea how to spend their money wisely. They might buy all sorts of things they don’t need, and then have nothing left over for important things like food and rent.

• Kids should learn how to budget

Budgeting is a skill that everyone needs to practice, and kids are no exception. Even if your kid isn’t in a position where they have to make their own money, it’s still important for them to understand what it means to spend wisely and save for long-term goals. You can start by teaching them about the difference between wants and needs, and teaching them how much things cost before you go shopping together.

Then, encourage them to set a realistic budget for themselves that takes into account all of their expenses (including their monthly allowance) as well as their savings goals—whether that means saving up for a nice pair of shoes or college tuition!

• Kids should learn how to save money

 It’s not uncommon for kids to have trouble saving money—especially when they’re young. They may not understand the value of money yet, and they often don’t have enough time to think about how much fun they could have if they put some of their allowance toward an investment.

One of the most important things you can teach your kids about money is how to save. They need to understand that saving money is a valuable thing to do—that it’s worth putting some cash away in a savings account, in a piggy bank, or under their bed. And they’ll learn this lesson more effectively if they start young.

• Kids should understand that credit cards are not free money

One way to do this is by teaching your kids about credit cards. Credit cards can be a great tool if used properly—they allow you to build a credit history and establish a payment record that will help you get better rates on loans later in life. But they can also become very dangerous if you don’t understand how much money is coming in versus how much money is going out. Kids should understand that credit cards are not free money; they need to pay back what they borrow.

It’s a tough lesson to learn, but kids should understand that credit cards are not free money. When your kids have a credit card, they should be using it for emergencies only—not for buying their friends’ lunch or new shoes because they “can’t wait until the next paycheck.”

This will help them avoid getting into debt and learn about the importance of saving before spending.

conclusion

What is most important about this research, I believe, is finding ways for children to develop financial skills. Teaching kids to save, plan for the future and be responsible with money will help them be successful when they grow up. Schools should teach practical financial lessons that are within a student’s grasp. But more importantly, parents should give kids money and make saving a habit from a young age.