Burgeoning Need To Bridge Financial Literacy Gap Among Children
Why there is a burgeoning need to bridge the financial literacy gap amongst young kids & how it can be done.
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Indian families love talking about values, culture, mythology and good habits with children. Ask them to discuss money and the common reaction is that the kids are too young to understand the intricacies of money, spending and investments. However, parents must first reiterate the fact that age is no barrier to learning financial literacy.
Need for financial literacy for young kids.
Parents ensure that their kids learn swimming, riding a cycle and other skills which are considered essential in this day and age. What they forget is that financial literacy skills are also an invaluable life skill that is often neglected. Children are taught good social habits. Good money habits are no different.
Just as inculcating strong moral values lays the foundation of a fantastic future, a strong understanding of money right from a young age sets the foundation of a responsible adult. Kids today are smart, well informed and are aware of the latest trends in toys, video games, entertainment and fashion. They are however unable to distinguish between their needs and wants. Parents also indulge every whim of their children. This often sets a wrong precedent where the child fails to realize the value of their parent’s hard-earned money. Parents need to realize that life is all about choices and at some point, in time, the child has to make independent choices. Most of our choices involve different aspects of money. A money smart kid has a higher chance of not being crushed by mounting debts due to wrong choices. There is no doubt a growing need to make kids money smart.
Teach them money skills young and watch your kids grow into prudent investors who doubles up as a conscientious consumer. Young kids today need to be taught the power of savings. They need to be told that one has to work in order to earn money. They need to realize the power of compounding. As they grow, they should be taught different investment avenues. Financial wisdom in their child is what the parents should think about. They should realize that money plays an important role in the overall wellbeing of an individual and leads to a fulfilled life.
Learning is a lifelong process and simply put, the kids who develop the ability to make better financial decisions as adults, are better equipped to manage money and debts and are in a much better position to achieve their financial dreams and goals in life.
Bridging financial literacy gaps in young kids.
All this might sound overwhelming. Your child might not be old enough to understand financial obligations but nothing prevents you from conveying the power of savings with a piggy bank.
You can teach your kids to maintain a budget by asking them to record their expenses in their notebooks. You can take your kids to your local bank and let them experience the banking ecosystem. Take them with you when you go out to buy groceries and let them learn the concepts of price, money, coins and value. We are in fact looking here at limitless possibilities.
Parents can engage their kids productively and spend quality time with them through several innovative DIY activities. Countless ideas are available online.
Where there is a will, there certainly is away. In life, some are wise and some are otherwise. One of the reasons is prudent money management skills. It is high time that parents realize this and takes the right steps towards creating a bright future for their kids. Talk to your children about money and watch them grow. Financial literacy is a skill that can be learnt and mastered through practice. Kids are never too young to learn. It’s never too late to start learning.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house
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