Money has been changing and evolving for the past several years – and so, too, should the way we teach money to our kids.
Your parents likely sat you down for a lesson on balancing a checkbook, but the same lesson won’t help your 21st century kid navigate a financial world made up of credit cards, mobile wallets and online shopping.
Don’t panic. It’s not as complicated as it sounds.
Here are some fool-proof ways to get your kids financially savvy in an increasingly cashless world.
It starts with real money. It’s important for young kids to learn and understand that real money lies behind each of the swipes of your credit card and the taps of your smart phone. Make an effort to use real money when shopping with your young children so they can see and understand the exchange of money for goods. Ask them to help you count the money and teach them what the currency looks like and what it’s worth. That way, they’ll have a solid understanding of money before they delve into the digital world.
Tweens can go virtual. When kids hit 12 – 13, they generally have a solid enough understanding in money basics to begin dabbling in currency in its virtual forms. Open a custodial checking account with your tween. Show them how to check the account balance and give them a debit card that can access the account. Begin sending your teen any allowance electronically into the custodial account, encouraging him or her to keep track of the money in its digital form. Be sure to also explain to your tween how somebody could steal money from their account by compromising their identity. Teach them to be safe with their debit card.
Teens can use their phones. Once your teenager shows a level of responsibility with his or her virtual money, it might be a good idea to give them a little more autonomy.Consider allowing a teen to sync his or her debit card up with a virtual wallet. But first, thoroughly explain all the ways a virtual wallet can be hacked and compromised. Be sure teens understand how to safely use the wallet to make purchases.