Teach Your Children Financial IndependenceApril 24, 2015 - by Patrick Redo
Are your kids on the right track to financial independence?
For many of today's young adults, the weakest link lies in learning the basics. According to a 2014 survey conducted by Harris Poll on behalf of Junior Achievement USA (2014 Teens and Personal Finance Survey), 40% of teens do not have a savings account, checking account, or debit or credit card, and 59% of teens do not have money management classes offered at their schools.
Achieving economic prosperity is difficult, and it's especially hard for young people who've never learned how to manage money.
allU.S. Credit Union is ideally positioned to respond because we believe in the power of education. We're here to help you launch the youth in your life toward financial independence, and here’s how:
Join. For starters, open an allU.S. savings account for each child in your family. Guide teenagers through using a debit card and tracking transactions.
Share. Include your children in household money discussions. Show them how you budget income and expenses. As their skills improve, give them challenges—such as finding a better cell phone plan, calculating the total monthly cost of owning a car, or sticking to a budget for back-to-school or holiday spending.
Show. Show your children how to live within their means by setting a good example first. Stop buying things you don’t need. Kids learn by osmosis. If they see you doing something, they will copy. You need to show them what smart buying is all about. You can’t teach good personal finance if you don’t at least try to practice it yourself.
Teach. Let your children know that automating their money and bills is one of the best ways to keep their finances in top shape, maintain stellar credit, curb overspending, and not stress out about paying bills on time. Automation means you siphon your income into various channels each month such as into a savings account, an investment account, a credit card, and finally your bills. This method forces you to “pay yourself first” by saving and investing, and then pay all your bills on time.
Coach. Remind your children to ask for help when they need it. And turn to allU.S. when you want help. Our tradition of service and philosophy of self-help make allU.S. Credit Union and all credit unions a natural partner in pursuing financial security. Check out the resources on our Member Center. We are committed to being your financial advocate, providing you the necessary resources to better manage your money and make informed financial choices.
Remember, we're here to help because working together; we can open the door to a lifetime of opportunities for your children.