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 Knowing we want to help develop positive skills and
knowledge is one thing; being able to do it is another. Each
individual comes with their own personality and approach to daily
challenges. Parents are only one of many factors that influences
children. Lecturing youth about what they should do or don’t do with
money is probably not very effective. What can we do so that youth
grow into adults with strong financial capability skills?
Pulling together research from many fields, there is now a new youth
financial pedagogy that can help guide parents from the time their
children are preschoolers through their late teens. Essentially the
new framework suggests we help youth: 1) improve planning and
problem solving skills, 2) create positive financial habits, 3)
learn to compare and contrast choices, and 4) practice financial
decision-making. More details information can be found about this at
https://www.consumer
finance.gov/data-research/research-reports/personal-finance-teaching-pedagogy/.
How can parents put this into practice in their daily lives? First,
from the time youth begin elementary school parents and adults can
help youth develop planning and problem-solving skills. To manage
money, a person needs to be able to plan, focus their attention, and
remember details. In a similar manner, youth can learn to plan their
day, stay focused on tasks, think before acting, and prioritize what
they want to do.
To develop money skills, it can be helpful for children to have ways
to earn money at home. Parents can consider developing a list of
household chores they are willing to pay their children to do.
For young children, chores need to be manageable and ones that can
be done relatively quickly. Examples:
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put old newspapers in recycling,
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clean the front of kitchen appliances, and
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folding towels.
Older
children can manage more complex chores such as:
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wash a car,
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organize a hall closet,
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weed a flower bed, or
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tidy a junk drawer.
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To
save up money to buy something special, youth will need to plan
how much work they need to do, stay focused on their goal, and
prioritize between buying something “now” versus saving up for a
future purchase. Keep in mind that “future” may be one or two
weeks for very young children. By middle school, youth likely
will be able to plan for spending in more than one category and
be able to research their larger purchases to find the best
match for their values and goals.
Take time to talk to youths about the difference between needs
and wants. Explain how one’s values influence what they choose
to purchase, and what they don’t.
Daily
life provides lots of opportunities to talk to children about money
and for them to practice money skills. Here are ideas to consider:
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While at the grocery store, have preschoolers
help shop for items pictured on coupons. Talk about how coupons
help save money.
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Older children can compare the cost of an
eight-ounce serving of different beverages.
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Let a child plan a family outing or event that
fits within a budgeted amount. Encourage creative ways to do fun
activities with a small amount of money.
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If you have a larger purchase, ask middle and
high school youth to research different options. Direct them
towards trustworthy sources of information.
These
type of activities help youth learn how to compare and contrast
choices. Conversations about their activities will help reinforce
positive financial habits.
Providing opportunities for youth to practice and learn about
financial management means that they will become confident in their
ability to achieve their financial goals, which is needed to be good
financial managers as adults.
[Terri Miller, MPA
County Extension Director - Unit 16]
News Source: Kathy Sweedler, Extension Educator, Consumer Economics,
sweedler@illinois.edu
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