9 Personal Finance Tips For Parents Teaching Their Kids About Money

father talking to son about money

Any time is a good time to start teaching your children about money. If you want your kids to learn more about personal finance, check out these 9 personal finance tips that will help them throughout their life.

1. Talk Openly About Money

The first tip is to talk open and honest with your kids about money. Your everyday experiences are great opportunities to talk about money and encourage them to ask you questions. Research the answers together or speak to your banker.

2. Explain Needs vs Wants

money in jar in college roomIt’s easy to teach your kids the difference between needs and wants. While at the grocery store, a simple way to explain needs vs wants is milk vs soft drinks. You may want a soft drink, but you need milk for strong bones. Parents budget for families’ needs like housing, clothing and food. While saving for future expenses, such as college tuition and retirement.

3. Make a Chore Chart

Another personal finance tip is to set up a chore chart and give your children an allowance for completing their tasks. You should require them to save a small portion each week. We recommend implementing the jars method: one for saving, one for spending, one for sharing and one for investing. Encourage your child to set a financial goal, such as saving for a bike and discussing how to achieve it.

4. Open a Savings Account

Open a savings account for your children with Tennessee State Bank! Bring them with you to make deposits, that way they can learn how to be hands-on with their money and can get an early start on saving money. When your kids are younger, you can ask relatives to contribute to a college fund instead of giving them toys.

5. Paying Bills

woman with debit card on laptopDescribe the many ways you can pay your bills: over the phone, by a paper check, electronic check or online check draft. Discuss how each method of bill pay takes money out of your account. Stress the importance of paying bills on time.

6. Using credit cards

Talk to your teen about credit. When you use a credit card, it is a loan and needs to be repaid. They should understand the implications of accumulating debt and aim to pay off their monthly balance in full.

7. Avoiding Identity Theft

When online, explain to your children how valuable their personal information and privacy is to you, to them and to online predators. Make them aware of the risks of sharing certain information. As a family, make a list of rules for keeping personal information safe online.

8. Make a Savings Goal Together

When planning your next vacation, emphasize the value of saving as a family. Figure out the cost and discuss ways everyone can help to reach the goal.

9. Your Child’s First Job

teen at first jobAs your child gets older, you can help them find simple jobs, like babysitting or mowing the neighbor’s lawn. When your teen starts their first job, help them create a savings and spending plan so they learn smart ways for using their money in the future.

About Tennessee State Bank

Tennessee State Bank has been serving our local community for over 48 years. With branches in Sevier County, Knox County, Cocke County, and Jefferson County, we offer convenient banking services in East Tennessee. Whether you’re looking to open a checking account, obtain an auto loan, or apply for a home mortgage, we make the process as simple and straightforward as possible. Tennessee State Bank’s motto is “Banking at its Best!”SM, and we strive to live up to that creed every day. Let us know how we can help you by sending us a message via our Contact Form.

Tennessee State Bank is a Member FDIC and an Equal Housing Lender.
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References

“How to Talk to Your Kids About Money.” American Bankers Association, https://www.aba.com/advocacy/community-programs/consumer-resources/kids-money/talk-your-kids-about-money

“The Road to Financial Responsibility: Tips for parents to teach kids smart financial habits.” American Bankers Association, https://www.aba.com/news-research/research-analysis/financial-responsibility