A New Way To Teach Children About Personal Finance

A New Way To Teach Children About Personal Finance

The President’s Advisory Council on Financial Capability recently released Money as You Grow, a website that provides 20 essential, age-appropriate financial lessons—with corresponding family activities—that kids need to know as they grow.  Written in down-to-earth language for children and their families, Money as You Grow is intended to help parents equip kids with the knowledge they need to live financially responsible and successful lives.

Here are some examples.  For 6 – 10 year olds, lesson #5 is about making choices about how to spend your money.  Suggested activities include bringing your child with you when going food shopping and explaining why you chose one item over another, or giving your child two dollars and allowing him or her to choose which fruit to buy.  One of the lessons for 11 – 13 year olds is to explain how compound interest works.  The site provides examples of investment growth and also contains a link to the SEC’s compound interest calculator at http://investor.gov.

Financial literacy is not something that is commonly taught in schools, yet is critical for successful financial planning.  Recognizing this, President Obama signed an executive order on January 29, 2010 creating the President’s Advisory Council on Financial Capability (PACFC).  Its goal is to provide financial capability policy recommendations for the nation to the President of the United States.  One of its key objectives is to find ways to improve the financial literacy of young Americans

The Money as You Grow website is located at http://moneyasyougrow.org/.  I encourage parents to utilize these lessons to teach your children basic personal financial concepts.  You will be laying the groundwork for success for your children’s financial future!

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