One of the most important-yet-overlooked lessons you can teach your kids is about how to handle their money. Deciding to teach kids about money is a great decision, and doesn’t have to be difficult when you have some great tools at your disposal. You might give your kids an allowance and go over the values of coins with your preschoolers but then fall a bit short when it comes to discussing the pitfalls of credit card debt, the importance of saving money and how to set up a budget.
Fortunately, there are a variety of really cool tools that you can use to explain this often dry subject. Check out the following ideas:
Great Tools to Help Teach Kids About Money
Use the Power of Superheroes
For kids who are in the tween stage of middle school, Practical Money Skills is the Holy Grail of cool financial tools. Case in point, they recently released a “Guardians of the Galaxy” comic that helps kids become financial superheroes. The comic book, which is available in eight languages and can be downloaded directly from the site, teaches about the importance of saving money as well as about the differences between wants and needs.
The educational comic “Rocket’s Powerful Plan” features an interesting story that involves learning to manage personal finances while defeating the evil Robo-Pests and Collector. If your kiddo seems really into the lessons and wants to take them to the next level, you can also print out a Superhero Saving Smash Worksheet that offers more tips about becoming a great saver while also testing their knowledge about money. Make it fun when you teach kids about money!
Use the Technology of a Smartphone
Tweens and teens whose eyes might glaze over during a talk about finances might be more engaged if you add one of their favorite devices — a beloved smartphone — into the mix. Start off your chat by explaining how the world is slowly but surely heading toward digital currency, and use the smartphone to find articles that discuss how economists estimate that only eight percent of the currency in the world is actual physical cash. Then, show them how a smartphone is a great tool for handling their money and can also be used to pay for things. For example, the Samsung Galaxy S7 is compatible with Samsung Pay and Android Pay, which means people can head out shopping without the fear of someone stealing their cash or credit cards.
Use an Online Debt Calculator
As soon as your teens turn 18, they will start getting letters from credit card companies, enticing them to apply for those shiny little plastic rectangles that let them buy whatever they want. Before this happens, it is easy to teach kids about money and talk with them about the dangers of credit cards. Discuss things like how a $20 dinner can turn into a $35 dinner if they take months and months to pay it off. Sit down with your teen and your tablet and use a free online debt calculator, like the one at The Simple Dollar, and have them take turns entering in different interest rates and total amounts due so they can see how quickly even a seemingly low-interest rate can add up.
This is another great opportunity to remind them of the importance of paying cash for both their wants and needs. While it might be OK to have one credit card with a low limit on hand for true emergencies, teach them that they shouldn’t use it to pay for movies, cheeseburgers, and Starbucks.