If your child is old enough to ask for a toy or a bike, they are old enough to start learning financial lessons that will last a lifetime. The best financial lessons are part of everyday experience. Look for opportunities to talk to your child about money, read books aloud, and play games that center around spending money wisely. Be open and honest when you discuss your financial experiences—good or bad.
The following examples will help you explain money to a child:
Visiting the bank
When you go to a bank, like First Bank, bring your children with you and show them how transactions work. Ask the manager to explain how the bank operates, how money generates interest, and how an ATM or ITM works. Keep in mind, during the pandemic, you will need to make an appointment online or by calling your branch. You do not need an appointment to use an ATM or ITM.
Receiving your paycheck
Discuss how your pay is budgeted to pay for housing, food, and clothing, and how a portion is saved for future expenses, such as college tuition and your retirement.
Shopping at the grocery store
It’s easy to give clear examples of “needs” and “wants” using different kinds of foods at a grocery store. Milk is a need; soft drinks are a want. Explain the benefits of comparison shopping, coupons, and store brands.
Assigning chores and allowances
Assign chores and give them a monetary value. Discuss ways to budget and divide allowances. Encourage children to set a financial goal, such as saving for a toy or bike, and have them figure out how to achieve it.
Explain the many ways that bills can be paid: over the phone, by writing a check, electronic check, or online bill pay. Discuss how each method takes money out of your account. Be sure to cover late penalties and emphasize the importance of paying bills on time.
Using credit cards
Explain that credit cards are a loan and need to be repaid. Share how each month a credit card statement comes in the mail or via email with a bill. Go over the features of different types of cards, such as ATM, debit, and credit cards.
First Bank offers a Genesis Mastercard® debit card, allowing parents to open a joint checking account with their child’s account. This allows children the opportunity to learn good financial management lessons, while parents can monitor spending with account alerts.
Browsing the Internet
While online, explain to your children how valuable their personal information and privacy is to you, to them, and to online criminals. Discuss the risks and benefits of sharing certain information. Then, as a family, make a list of rules for keeping personal information safe online.
Visit our Security Hub for more information on how to keep your personal information safe online.
Planning a family vacation
Whether you’re planning an outing to a local amusement park or your next family vacation post-pandemic, emphasize the value of saving as a family. Set a family savings goal that involves your children. Figure out the cost that needs to be saved and discuss ways everyone can help to reach the goal.
Schedule an appointment to bring your child with you to set up a separate Statement Savings account or have them watch you as you open a savings account online from First Bank to start saving toward your dreams today!
(American Bankers Association, ABA)