April is Financial Literacy Month. Great, you think but why should Financial Literacy Month matter to parents? Because teaching key money principles is a responsibility that often falls primarily on parents.
The Survey of States by the Council for Economic Education found that only 17 states (34% of states) require high school students to take a course in personal finance. That fits with a study conducted by BusyKid, which found only 33% of parents said their kids learn about personal finance in schools.
So, financial education falls to parents, right? Well, you would think so, but apparently that’s not always the case. In fact, that study found that only 21% of parents are regularly talking to their kids about their money situation. Here are some more fascinating facts about financial education (or lack thereof) for our kids.
We live in one of the states that requires a personal finance class and while I’m glad we do, most kids don’t take it until senior year. A lot of kids are already 18. Hopefully, parents are talking with them before then.
In his great book The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money, Ron Lieber, the “Your Money” columnist for The New York Times, points out that the decisions about money are often based upon and reflective of your values. (I thought this book was a great read and highly recommend it.)
Letting your kids in on your financial decisions, and the reasons behind them, can be a great way to teach them about financial literacy and what matters most to you. And April is a great time to start, but I’m also a really big fan of taking advantage of the summer months, when kids don’t have homework, to really dive in to family finances.
Start with your kid’s summer activities – What are they doing? What’s the cost? Why are you willing to pay for it? (presumably it has benefit that you value) Also consider giving your kids some money to manage over the summer.
You can find resources for teaching financial literacy here on the NEA website and while they’re aimed at teacher’s they’re great for parents, too. And BusyKid offers some terms that your kids, especially teens, should be learning here.
Like all important parenting matters, this isn’t a topic you cover in one quick talk, check the box and move on. It should be an ongoing conversation, and one that can pay big dividends in the long run.