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Wealth & Well-Being

Financial Literacy: The gift that keeps on giving

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There are many opportunities you have as a parent to impart valuable life lessons to your children. Starting when they are very young, you teach them kindness and respect for others. As they grow older into teenagers and young adults, you can continue to teach and mentor your children, helping them gain the confidence to make their own decisions once they become fully independent.

Teaching your children about money and managing their finances, starting at an early age, can help them develop into smart, financially literate adults. For the most part, lessons about finance and money management are missing from school curricula. It's often falls on parents to teach children important lessons about money management and making financial decisions.

Fortunately, there are plenty of resources out there to help you. No matter what age you children are or how experienced they are in managing money, you can give them the gift of financial literacy to help them grow into financially savvy and skilled adults.


For children and young adults who have no financial knowledge of their own, lessons about budgeting are the best place to begin. At an elementary level, making a budget can help them see how money comes in and out of their lives.

Budgeting sounds complicated, but there are really only two components—income and expenses. The income component is obvious—it's the amount of money you earn in a month. Where budgeting can get complicated is in capturing all of your expenses over the course of a month.

At Smart About Money, your children can access basic calculators and worksheets they can use to build a budget of their own and analyze important financial decisions about saving and spending.

You Need A Budget offers simple and versatile software your children can download to help them customize their own spending and saving plan. They can download a trial version of the software to use for about a month for free, before purchasing the full version.


For adult children, understanding the forces that shape their financial lives is the next step in building financial literacy. Naturally, as children transition into early adulthood, the financial decisions they face become more complicated. Education costs enter the picture, and for the first time your children may have to take on debt for college, vehicle, housing or other expenses.

As their financial decisions add up, they begin to see how their choices influence their budgets. Learning how to make these decisions wisely can help your children stick to the budgets they set and not get too deep into debt.

SALT is a great web site for older adolescents and young adults. The site includes extensive resources on education planning and managing student loan debt. Plus, your children can find guidance for making the leap into the workforce and finding that first full-time job.


Greater financial literacy gives your children the potential to plan ahead for bigger financial goals. Once they establish careers and start earning steady income, your children will look to make bigger purchases such as homes and cars. These often require your children to save for down payments and manage more debt.

It's also a good time for children to develop savings habits and build their investment knowledge. Making a habit of saving early in adulthood can help ingrain financial discipline that can last throughout their lives. Plus, starting to invest early gives young adults the benefit of time to compound their investment earnings.

For more sophisticated financial knowledge, Khan Academy offers video lessons on a wide variety of complex financial topics—debt management, inflation, taxes, stocks and bonds, and retirement plans.


With financial literacy lacking among many people, giving your children the gift of financial literacy can help them gain an advantage in adulthood. Perhaps more importantly, increasing your children's financial smarts and savvy will help them grow into more confident and financially stable adults.

Written by Robin Young

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