It is important for parents to teach their children about money. Poor money education or the lack of it could cause them to fall deeper into debt as adults. Here are some misconceptions that parents should be aware of:
- My child is too young to learn about money management: Our children are old enough to learn about money management if they are already able to talk. When our toddlers are not yet learning to talk, we could still provide some basic skills, such as simple knowledge on numbers, additions and subtractions. As our children get older, we can talk to them about basic money skills and they will be able to become more responsible when dealing with money.
- Money isn’t a crucial thing in my family, so it isn’t necessary to teach kids of money management so soon: People should admit that money is essential in life, although they have billions of dollars and they no longer need to work. Without money, it is hard to survive. Even people who live in the middle of nowhere will need to go to the nearest towns to get medical services, hunting supplies, tools and others. For urban-dwellers who don’t undergo a life-sustaining lifestyle, they obviously need money for travel, education, entertainment, clothing, housing and others. Whether we like it or not, money is essential. It isn’t necessary to teach children about various materialistic things, but we need to teach them about money, so they can survive.
- School is enough: Unfortunately, there are so many things that schools don’t and can’t teach. There are only a few hours of study time in schools each day. State laws typically regulate what should be taught in schools, such as math, science, social studies, languages and others. For this reason, schools don’t teach money management and it’s up to the parent to teach children about this. If by chance, the school does teach money management, it is important for parents to make sure that children are applying the principles in real life. Parents should also become the financial role model and they should take measures to teach children about these facts.
- My children are already busy studying: There’s no denying that children can be as busy as their parents. With school, sports, homework and other activities, children barely have enough time to rest until 6PM. Parents may think that it is impossible to incorporate money lessons in children’s daily schedule. In reality, parents don’t have to hold a special money management session each day. One short session each weekend is enough and it is more important to teach children by being a role model. Non-verbal education is also essential.
- I’m rich, my children will inherit so much money: Huge inheritance isn’t a guarantee for financial success. Many lottery winners and celebrities filed for bankruptcy, although they get millions of dollars. It is still important for children to know how to manage money and it is even more important if they will likely have a lot of money.