Raising kids who are money smart takes a village

A friend once told me that what kids need to know about money could be summed up in two words: Save more.

If only socking away money were so simple. By the time the kids move out of the house and strike out on their own, I think they’ll need at least some basic financial knowledge about budgeting, banking, credit cards and credit scores, investing, identity theft, student loan repayment programs, health care — the list goes on.

If you solely judge test results and surveys, American kids generally continue to get low marks and lag behind peers in other countries when it comes to their financial acumen.

But I offer a different perspective — one cultivated from writing about personal finance for more than 38 years, including about half my career teaching kids about the value of money.

So has there been progress? Are financial literacy efforts working? Are our kids going to have the money smarts necessary to figure out needs vs. wants as they grow older? Set aside the numbers. This is what I’m hearing and seeing:

Family matters

When I speak to parent groups, I can count on getting a stream of comments about how they are trying to weave small financial lessons into everyday conversations with the kids.

They’re building up their children’s money savvy with repetition and real-life examples. This is a much better approach than having a sit-down to share all your financial wisdom with your 16-year-old.

While these moments can be uncomfortable, I think more parents get that they have a responsibility to teach their children about money. Besides, what you’re sharing now may actually stick 10 years down the road.

Grandparents have a role

Perhaps because they didn’t do such a good job teaching their own kids about money, more grandparents now want to work with the grandkids.

How do I know this? I hear from grandparents all the time. They have more time now to spend with the grandkids, meaning more frequent conversations and stories to share about the choices they had made about investing or saving for retirement. They also want to help with opening bank accounts and contribute to college savings programs, which just might be the best ways to spoil the grandkids.

Check the tool box

If you are looking for reading material on how to coach up your kids about money, there shouldn’t be any excuses. Over the last 20 years, there has been an explosion of books aimed at raising money-smart kids.

Even more significantly, technology has evolved. There are more financial education websites, more apps, more calculators that teach budgeting, and even more interactive games with money morals from the tooth fairy to billionaire Warren Buffett.

Classroom connections

According to the JumpStart Coalition, 22 states have a requirement in place to offer a high school course in personal finance. Other states have an economics requirement.

While those numbers are still disappointingly low, many schools fill in the gaps by partnering with organizations such as Junior Achievement and financial planning groups to bring teaching volunteers into classrooms.

I volunteered in schools for more than a decade and found it easy to prod kids into conversations about credit cards, ATMs, gasoline prices, cell phone plans and the ridiculous salaries pulled down by professional athletes.

Perhaps not surprisingly, kids learn when you make the material relatable. That’s one way I measure progress.