Steps To Teaching Kids Financial Literacy From First Bank Account To First Job -“Can I open a Bank Account For My Kid?”
“Can I open a bank account for my kid?”
Even though discussing money can be awkward, parents should begin teaching kids financial literacy and more about money management at a young age. However, a 2021 Chase research found that only 30% of American parents consistently talk to their kids about money matters. Read also 8 Great Financial Lessons You Can Learn From Each Other As Couples
Teaching Kids Financial Literacy From First Bank Account To First Job — “Can I open a Bank Account For My Kid?”
Early financial education will help kids get ready for the future. It’s an opportunity to educate your children valuable lessons and provide instructive moments as you walk them through different financial milestones. The financial milestones your children should be achieving and when the quest on “can I open a bank account for my kid?” are listed below on steps to teaching kids financial literacy. Read also How To Manage Your First Salary Wisely To Aid Your Financial Independence
The Financial Milestones Children Should Achieve At Every Age
1. You Can Open Their First Bank Account At Any Age
” Based on the quest “can I open a bank account for my kid?” This first step answers that as “yes and sure”. It’s never too early to open a bank account, and doing so is one of the simplest methods for parents to teach their children about money. Having a bank account has advantages for both parents and children. First, it facilitates crucial discussions about the fundamentals of money with examples from real-life situations, from spending and saving to describing interest and how it builds up. Second, it gives a kid a sense of freedom and responsibility, which gives them the chance to decide how to spend and save.
Parents should select a savings and checking account that enables parents to keep tabs on and regulate their children’s spending. For instance, Chase First Banking is an option for children aged 6 and older and includes a unique debit card that can be controlled solely through the Chase Mobile app by both children and parents. The child can advance to High School and College Checking accounts as they get older. Early bank account opening on the quest” can I open a bank account for my kid?” by parents will ensure that kids are headed in the right direction for financial success. Read also 7 Smart Things To Do With Your Money Every Now And Then(Very Important)
2. At age 5 or 6, Receive An Allowance
Letting your kid earn their first allowance when they’re five or six is great. When your child is prepared to learn how to save and how to handle money responsibly based on teaching kids financial literacy, start giving them an allowance. It’s important to start out easy. Parents might start modest and increase it as their child gets older and/or starts to take on more responsibility.
Giving your kids an allowance provides a chance to talk to them about saving money and leveraging the question “can I open a bank account for my kid?” many parents ask. Determine what they want to save for, then instruct them to set aside a particular amount of their allowance each month to help them accumulate the funds. It is totally up to you whether or not to pay your child for tasks they do; what matters is that earning money encourages crucial financial discussions. Read also 7 Practical Daily Financial Habits That Will Positively Improve Your Life
3. At Age 8, Let Children Participate In Family Budget Preparation.
Your child should be mature enough to comprehend addition and subtraction when they are about the age of eight, at which point they should also be able to comprehend the idea of money coming in and leaving out. The development of a solid financial foundation is aided when parents engage their children in discussions on how to save money, set aside money, and spend it wisely. Children can learn the distinction between needs and wants by using real-life situations as teaching opportunities.
Show them how to budget for necessities like food and other home costs, or assist them in making their own budgets so they can afford extras like summer amusement. This will develop money management skills and demonstrate that talking about money doesn’t have to be taboo. It will also show how to balance saving and spending on needs and wants. Read also Financial Literacy Strategy To Build Sustainable Wealth
4. Take a Summer Job When They’re Age 14
It’s a good idea to urge your youngster to acquire a summer job as their weekly allowance may not be enough to pay all they want to buy by the time they reach adolescence. Children and tweens who are eager to make money outside of the home through chores, babysitting, or yardwork may be prepared to begin their first job. Starting their first job is a significant accomplishment and a great time for parents to discuss finances with their teenagers. For instance, since they probably already have their next purchase in mind before receiving their first paycheck, it’s a fantastic moment to talk about wise spending practices.
They should talk about their desired purchases. When they do buy something, remind them to first check their bank account to determine how it would affect their total finances. If teenagers learn to make wise financial decisions, they will be better prepared for future financial independence and a variety of additional expenses. Read also 10 Must-Read Habits Of Financially Successful People
5. At Ages 16 To 18 They Open Their First Credit Card
Although a person must be at least 18 years old to get their own credit card, you can enroll your child before this milestone as an approved user. Giving your child access to a credit card in their late teens will enable them to begin building credit and also teaching kids financial literacy and how credit works, according to some financial experts.
Whether a youngster receives their own card or is added to their parents’ card depends on the household, this also levels parents quest “can I open a bank account for my kid?”. However, before giving them the card, make sure they comprehend the fundamentals of credit, the effects of debt, and the best practices for spending and paying their bills on time. Their credit history and credit score will be established early on as a result, which will aid them later on when making important financial decisions like buying their first car or renting an apartment. Read also Top 10 Expert Financial Advice For Building Long-Term Empire Of Wealth
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