Instilling Financial Literacy For Kids In Cleveland

Memorial Day weekend can often feel a little disjointed.

There we are with our burgers, our pools, our picnics — all while we are supposedly remembering the sacrifice of so many thousands who laid down their lives in the line of duty for this country, and for the sake of our constitutional freedoms.

However, when you talk to veterans from Cleveland (as I get the chance to do in the course of our tax preparation work), they do often tell you that these very freedoms (the ones much bigger than backyard barbecues, of course) are exactly why those sacrifices are worthwhile.

So I suppose that despite how jarring it can feel, parades and picnics are exactly the right sort of thing to honor those men and women who made the ultimate sacrifice.

And so we pause and remember.

Memorial Day is much more than simply the “start of summer”.

Moving forward … now that summer *is* here, for many Cleveland families, children are much more “underfoot” than they are during the school year.

So I have an idea for you: Might I suggest the summer to be the PERFECT time to rework your children’s relationship with money? Here are some thoughts on financial literacy for kids that might help start the conversation…

Instilling Financial Literacy For Kids In Cleveland
“Adversity doesn’t test character, it reveals it.” James Lane Allen

Teaching children to save money when they’re young can help them deal with financial emergencies when they’re older. Here’s how to get them started, even this summer…

Encourage kids to save *something* over the summer. 
Whether you’ve got a 10-year-old stashing away a dollar or a teenager opening a savings or checking account, get your children in the habit of saving no matter how small the amount. Start them small over the course of the summer, and have them build towards something for the end of the season that will be a real treat.

Help kids balance treats and sacrifices. 
Work with your kids to set and meet small goals, which will allow for small indulgences along the way. Once these smaller goals are met, allow them a little withdrawal to buy something for themselves. Go for the little victories in the beginning.

Instill the idea of an emergency fund. 
Loose change can add up, so don’t let kids toss pennies or leave them lying on the ground. These can become the perfect seeds for the concept of an emergency fund (which will help them as they grow into adulthood).

Set an example. 
Children don’t miss much. If they don’t see you saving, they might wonder why they have to save. Share with them what YOU are saving towards so they can see the process of building towards a victory.

Keep kids away from credit as long as possible. 
Credit card companies expend lots of effort on marketing to teenagers. And with the rise of app-related money systems, many children with smartphone access have even readier availability to the kinds of “time-saving” money traps that so often ensnare adults. Make sure your kids understand what credit pitfalls could lie ahead.

Schedule money meetings. 
Meet with your child at regular intervals to discuss their savings and emergency accounts, answer questions, and discuss money issues he or she might encounter. Especially if they are working a summer job in Cleveland, helping your children to see where their money is going over each month of the summer will help them to get financial clarity.

Which of course, leads to…

Help children set up a real budget. 
The earlier that young people learn to manage a budget, the easier things will be down the line. Younger ones can start learning by jotting their pluses and minuses down on a piece of paper, while older kids can be introduced to budgeting on software and apps.

The main thing is that you should not rely upon “school” to train your children in financial literacy.

And the summer is a great time to get started.

Warmly,

Rich Rhodes
(330) 225-3928
Hinckley Tax Service