Better Financial Health in 15 Minutes (or less!)

Raising Financially Savvy Kids: Practical Tips for Teaching Money Management Skills

• Stacey Hyde

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Unlock the secrets to raising financially savvy kids with Stacey Hyde in this enlightening episode of Better Financial Health in 15 Minutes or Less. Imagine if your child could navigate their financial future with confidence and wisdom, avoiding the pitfalls many adults face today. By tuning in, you'll gain practical insights into teaching children of all ages about money, from the simplicity of recognizing coins to the intricacies of managing a credit card responsibly. Stacey shares personal anecdotes, like her childhood memory of her mom's credit card lesson at Sears, to highlight the importance of early financial education. Together, we challenge the notion that money should be a taboo topic and instead propose it as a vital family conversation.

As we explore effective methods for instilling values like saving, spending wisely, and giving back, you'll discover how chores and allowances can become powerful teaching tools. Stacey offers tips on structuring tasks around the house, dividing earnings into categories for spending, saving, and charitable giving, and setting tangible goals that motivate children to comprehend the value of money. As your children grow, learn how establishing a bank account and using a credit card with supervision can prepare them for real-world scenarios. Equip your children with the knowledge and skills they need to approach adulthood with financial acumen, confidence, and responsibility.

Envision Financial Planning. 5100 Poplar Avenue, Suite 2428, Memphis, TN 38137. (901) 422-7526. This communication is strictly intended for individuals residing in the United States. Advisory Services offered through Envision Financial Planning, a Registered Investment Adviser.

Speaker 1:

Hi, I'm Stacey Hyde and I'm back for another episode of Better Financial Health in 15 minutes or less, and I think one of the things that we see over and over again is that people oftentimes aren't taught about money. It's not something that's talked about at the dinner table. There could be shame or secrecy around money, but I think it's important to talk to your kids, or talk to your grandchildren about money. It needs to be age appropriate, so when they're young and by young I mean under five, you know just showing them the different coins, showing them you know a dollar, five, ten, and letting them learn how to count out money, how to make change and talk about it. I think it's also important to talk about credit cards and about how using a credit card still means that you have to pay it and the importance of paying it on time. I remember because I'm old as dirt being at Sears here in Memphis with my mom and she pulled out her credit card and I was like I want a credit card because you don't have to have any money, and we actually went home and she explained to me about how, yes, she used her credit card, but she was going to pay it off at the end of the month, and while it was so important to pay it off at the end of the month, and then as kids get older, I think it's important to have them do chores around the house to help out. Have them do chores around the house to help out.

Speaker 1:

I'm from the school that I think some chores should just be because you're a member of the household and you do those things. Those can be things like clearing the table after dinner, loading the dishwasher, unloading the dishwasher, taking out the garbage, but there can also be chores that you do that you do get paid for. Maybe it's something my kids always groan when I said it's time to clean the baseboards, something like that. That's bigger, maybe a more complete cleaning, maybe cleaning out a garage, doing sort of bigger things like that. Maybe working out in the yard can help them earn money. Or babysitting, depending on age, helping watch a younger sibling, or things of that nature, and I think as they get paid for that.

Speaker 1:

We were always taught that kind of it was divided into three some money was to spend, some money was to save and some money was to give, and in our case it was to give to church. But if it's other types of giving. You can help your kids figure out where they want to give the money, who they want to help with that. Popular ones are, you know, humane Society or animal shelters or the zoo or something like that. I think that's important to kind of create that culture of giving, of giving, and it doesn't have to be complicated, but, I think, helping them save, whether they have a savings account at a bank or whether they just have a piggy bank where they put some money. I think it's good to get them sort of used to that type of thing and then saving up for something maybe that they want.

Speaker 1:

Video games were always something that was popular in our house growing up. We would save for the latest Mario game, but I think that that helps kids kind of get used to spending and then, as they do get older, having a bank account. Then, as they do get older, having a bank account, and as they, you know, turn depending on the age, if they're doing a lot of lawn mowing, they can make a lot of money doing that Same thing with a lot of babysitting, or they work somewhere in retail or at a restaurant and they start getting real paychecks, having the bank account and also, at that point, getting a credit card and, with supervision, learning about credit, learning about how to pay that off, the importance of paying that off, the fact that, yes, you get 25 days give or take to pay off your balance and not have to pay any interest, but if you don't pay it off completely on time, then you're going to be charged interest and that means that anything you purchase that next month also earns interest from the moment you purchase it. You no longer get that 25-day free use of the bank's money. The other thing late fees can hurt your credit and things of that nature. So it's real important to, I think, get your kids acclimated with that.

Speaker 1:

Watching it, my daughter, I guess I scared her so bad about credit card balances. She used to pay hers off every week and for her she said that just made it easy. It kept her paying attention to what she actually owed and she never got caught by surprise and she said it just made it easier for her. She also had a Discover card where she could see what her credit score was, so she was very motivated to keep that very high. So I think that there's things you can do along that realm to really do it and I think, having those conversations with your kids about you know mortgages and utilities, because I think that it's easy to think that, okay, we live here and all we have to buy is food or maybe, and all we have to buy is food or maybe insurance for the car and for the home.

Speaker 1:

But there's a lot of costs associated with, as I call it, adulting. You know utilities that's water, electric, it's internet, it's TV, streaming services. There's just a lot of things that go on. And if you're a homeowner, there's a lot of things that go on. And if you're a homeowner, there's a lot of stuff that can go wrong. The roof can leak, the hot water heater can die, can have to paint the house, get a new roof, all those types of things that factor into having your own place, and I think that's important for people to kind of understand and prepare for. And the more you can kind of talk about it and expose them to it, the better off they'll be going forward.

Speaker 1:

So keep it age appropriate, talk about it. You know you may not want to share your tax return with them, but I think it's important to sit down and go through it and as they start having to fill out their own tax returns. When they're like 16 17, it's important to understand about taxes. I can remember my first real job and getting my thinking. I knew what I was going to get paid and then taxes wasn't expecting that. So I think it's helpful to have those conversations and walk kids through it. They'll be better off for it and if it's something you struggle with, it's something you can do together. Thanks for tuning in. This has been another episode of Better Financial Health in 15 minutes or less.