HOW TO TEACH YOUR KIDS ABOUT MONEY

Kids rely on Mom and Dad to fill them in on many things in life — and that includes money. “Children as young as 3 can understand basic money concepts like value, exchange, and choice,” says Make Your Kid a Money Genius (even if you’re not) author Beth Kobliner. During her research, Kobliner found that parents are the top influence on their children’s understanding of money. Here, she offers money lessons to teach kids at every age. uCurb your kids’ demands at the checkout line. “Children who are told yes all of the time have difficulty handling delayed gratification,” Kobliner says. “Remind them that you have to wait for the swings, wait for their birthday, and when you really want something, you save up for it.” uGive ’em cash. In her research, Kobliner found that young children don’t really understand the value of a dollar because many parents use plastic. “The next time your middle-schooler goes to the mall with friends, give cash to teach the basics of budgeting,” she says. uTake your kids to work. “The whole idea of work — that you go and perform a task daily in exchange for money to buy things—is something that is completely lost on a child,” Kobliner says. Show you kids your office and explain what you do. Then, she says, explain how your employer deposits money into your checking account, and then you use a debit card to withdraw money through the ATM. It shows them how banking works and that the money doesn’t just magically appear. uShow them how advertising works. The next time your child gets excited about that ad for the super cool new toy that everyone wants, explain that “advertisements — teach that word to little ones — whether online or on TV are made to make something see much cooler that it often is,” Kobliner says.

uEncourage college students to wait to get a credit card. Stop worrying that your kid hasn’t built up enough good credit. “Thanks to the Cart Act, which former president Barack Obama signed into law in 2009, you can’t get a credit card until you’re 21 unless you can prove you have income to pay for it, or your parents are willing to cosign,” Kobliner says. One result has been that Millennials have about half as much credit card debt as Gen-Xers did at age 27, she says. Kobliner’s best advice: Have them wait until they are least 21 years old or until they have a job that provides enough income to pay the credit card bill in full monthly —Tanisha A. Sykes