SAN ANTONIO — April marks National Financial Literacy Month, a nationally recognized campaign that’s dedicated to raising awareness about the importance of financial education. If you’re a parent, here are ways to empower your kids to get money smart today.
Model good financial behavior
“Adults have the same problem as kid’s do. Things are so easy to get. The consumption in this country is very easy,” said Karl Eggerss, senior wealth advisor and partner of Covenant. “Try to be a good example. If you’re buying something online every single day, and showing up on your doorstep, your child is going to see that and think they can buy as much as they want. There’s not much repercussions.”
Review your finances with your kids
“Open up your finances if you’re comfortable. You can do little or as much as you want with this. But perhaps let them see a paycheck, explain to them what these deductions are, assuming you know what they are. How much is going to the 401(k), how much the government takes out for taxes? Really start explaining those things to them,” suggested Eggerss.
Encourage kids to earn their money
Eggerss said one of the biggest mistakes he’s seen parents make, is giving children too much, too early on.
“A child in our neighborhood literally goes door-to-door and takes the trash can from the street for the elderly folks and puts it up into their garage door for them. They pay them a little something,” said Eggerss. “I actually invested in some things for them and in their particular jobs and it really helped them to see the benefit of earning a buck.”
Teach them about debt
“It can ruin people’s lives. We see all the problems with debt. Kids have a great advantage. Their age - because they can take advantage of compounding, which has a huge impact over the long term,” he said. “Saving 10% of everything that comes in the door, whether it’s birthday money or a part-time job and then, staying out of debt.”
Watch out for social media
"Social media unfortunately is adding fuel to the fire. We see what other people have. People see their friends, they dress really nice, they may have the latest jewelry," he said. "When they’re being inundated by these images on social media networks, it makes them want to consume more."
KENS 5 has covered a previous story on side hustle ideas. Also, check out the Consumer Financial Protection Bureau website. There are free educational tools including activities that can help children grow their money skills.