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Children & Money

It’s important for children to learn the basics of saving, how interest makes money grow, how to create a budget and how to distinguish needs from wants. These skills help to prepare children to make smart financial decisions now and as adults.

How To Talk To Your Children About Money

How soon is too soon to talk to your children or grandchildren about money?

If they are 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 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.

Here are some examples of teachable moments to help you get started:

At the bank

  • When you go to the bank, bring your children with you and show them how transactions work. Ask the Branch Manager to explain how the bank operates, how money generates interest and how an ATM works.

On payday

  • 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 retirement.

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 (for strong bones) is a need; soft drinks are a want. Explain the benefits of comparison shopping, coupons and store brands.

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 bike, and figure out how to achieve it.

Paying bills

  • Explain the many ways that bills can be paid: over the phone, paper or by check, electronic check or online check draft. Discuss how each method of bill payment takes money out of your account. Be sure to cover late penalties, emphasizing 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 with a bill. Go over the features of different types of cards, such as ATM cards, debit cards and credit cards.

Browsing the Internet

  • While online, explain to your children how valuable their personal
    information and privacy is to you, to them and to online predators. Discuss the risks and benefits of sharing certain information. Then, as a family, make a list of rules for keeping personal information safe online.

Planning a vacation

  • Whether you are planning an outing to a local amusement park or a once-in-a-lifetime trip, emphasize the value of saving as a family. Set a family savings goal that involves your children. Figure out the cost and discuss ways everyone can help to reach the goal.

Information provided by the American Bankers Association, www.aba.com

Top 10 Tips For College Students

The following tips are designed to give college students an edge on mastering personal finance, from understanding their credit score to the value of saving.

  1. You are in charge. You are responsible for your finances and you should act accordingly by creating a realistic budget or plan and sticking to it.
  1. Watch Spending. You control your money, determining how you spend or save it. Pace spending and increase saving by cutting unnecessary expenses like eating out or shopping so that your money can last throughout the semester.
  1. Use Credit Wisely. Understand the responsibilities and benefits of credit. How you handle your credit in college could affect you well after graduation. Shop around for a card that best suits your needs.
  1. Utilize Your Bank Account. Banks are more than money in a vault. They offer valuable services that students can benefit from like check cashing, debit cards, online banking, mobile banking, balance alerts, personal loans and direct deposit.
  1. Lookout for Money. There's a lot of money available for students, you just have to look for it. Apply for scholarships and look for student discounts.
  1. New is Out. Consider buying used books or ordering them online. Buying books can become expensive and often used books are in as good of shape as new ones.
  1. Entertain on a Budget. Limit your hanging out fund. There are lots of fun activities to keep you busy in college and most are free to students. Use your meal plan or sample new recipes instead of eating out.
  1. Be particular when it comes to money. Don't just trust anyone with your money. Be skeptical of classmates, friends or salespeople that have ideas for your money. 
  1. Save. Things happen, and it's important that you are financially prepared when your car or computer breaks down or when you have to buy that unexpected bus ticket home. No matter how small the amount you should start putting some money away immediately.
  1. Ask. This is a learning experience, so if you need help, ask. Your parents or your banker are a good place to start and remember the sooner the better.

Information provided by the American Bankers Association, www.aba.com