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Whether you have a child beginning elementary school, entering high school or heading back to college, now is an ideal time to engage him or her in conversations about money. From back-to-school supplies to new shoes or dorm items, your children are actively shopping with you for items they care about. As you pull out your wallet, take a few minutes to revisit some common-sense saving and spending tips that will inspire them to think about what they are buying.
Whether you present choices for similar items, highlight savings opportunities between online and offline stores, or ask them to prioritize their spending based on the most important items, you are establishing a framework for spending decisions. Students face an abundance of information online these days, but social media is making it harder for many to sort out fact from fiction per a recent Stanford University study of students from middle school through college. This is alarming as it indicates that many young people lack the financial knowledge they need and don’t know where to find it.
Who can teach them? Nearly one-third of students said their parents didn’t teach them how to manage money, and more than half said they hadn’t learned it in school either. But that is not to say there is a lack of interest in personal finance as most students in the LendEDU survey1 said they had taken or planned to take a college-level course on the subject.
A great way to ensure young people have a solid understanding of finances is to start talking about it at home. Young people who have a firm grasp on the importance of saving early for retirement and using credit wisely get a jump-start on achieving their goals, whether that includes going into their family’s business or setting out on their own. Of course, not every parent feels capable of starting these conversations alone. That is where a financial advisor can help. For more information on getting the conversation started, read our checklists for: