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Youth Related Youth Related Articles Teaching Our Children About Money:
Youth Related Youth Related Articles Teaching Our Children About Money: | Teaching Our Children About Money: |
| Written by Kandise Thomas-Humphrey, PhD. | |
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When was the last time you educated your child about the history, purpose, and uses of money? Or should we ask…have you educated your child about the history, purpose and uses of money? Most of us assume that as our children gain access to money and use it, they will automatically develop an understanding of it. Unfortunately, that is not the case in most instances. Many of us learn about financial management through trial and error. As parents, we can work to make sure that this is not the way that our children learn about money management.
Try giving yourself this short assessment regarding the history, purpose, and uses of money. • When was money, as we know it, developed? • Why was money created? • What does the bank do with the money that I deposit? • Where does my check go after I give it to the store? • What is the Federal Reserve? • What are interest rates and how do they influence my life? • How do banks make money? How did you do? Were you able to answer these questions to your satisfaction? Possessing a good understanding of the history, purpose, and uses of money is extremely beneficial for parents. By having this knowledge, we are able to provide our children with a balanced and complete perspective of money that will improve their financial management. For example, if my daughter decides to apply for a credit card while away at college, she will understand the purpose and proper use of a credit card. She will also be knowledgeable regarding terms such as "interest" as they relate to credit cards and money. Furthermore, she will be aware of the fact that banks make a majority of their profits from fees. As a result, she will shop around for the best offer that will keep more money in her pocket and limit the fees that she is charged by the bank. How many times has your child seen you with your checkbook and asked you to purchase an item for them? When you respond that you do not have the money to make the purchase, they cannot understand this response because they see that you still have checks in your checkbook. In their minds, if there are checks, there must be money. Many of our children do not understand the flow of money within our society. This is important for them to learn so that they can make the best decisions on how they will allow their money to participate in the overall flow. We must also share this information with them so that they can maximize the use and value of their monies as they work to manage it within the flow. They will then understand, just having a checkbook with checks in it does not mean that you have money available. There is a vast amount of information available on the internet that we can share with our children in order to teach them about the history, purpose, and uses of money. One very useful and practical site, The more that our children know about how money works in our society, the better prepared they will be to capitalize on the knowledge that we share with them. Managing money is an issue of the heart… Kandise Thomas-Humphrey, M.S.Ed. http://www.federalreserve.gov/otherfrb.htm, is sponsored by the Federal Reserve. There are twelve district banks throughout the United States. If a Federal Reserve Bank is located near your city or town, it would be an extremely educational field trip for your family or your child’s class to participate in. They would have the opportunity to see the basics and flow of money firsthand. If you are unable to take your child to visit a site in person, be sure to visit a local bank or one of the Federal Reserve district websites. The web pages on these sites have an educational link with great resource material. Some even have an online tour of their facility for your child to view. |
