A lot of youth today dream of becoming a millionaire YouTube star. Never say never, right? For most youth, however, becoming a teen millionaire is just that, a dream. However, it’s never too early to begin teaching youth about the importance of finances and savings. Your child’s financial literacy skills will lay the foundation for their financial success for the rest of their life. For kids, finance education begins at home.
Financial advisors with Sagevest provide examples of financial topics for different ages;
Ages 3-4: Promote financial learning through play. Explain that money is earned by working and that it’s used to buy things. Teach the difference between nickels, dimes, quarters, and various bills. Avoid using a credit card as much as possible when shopping with your kids.
Ages 5-7: Start an allowance and money basics. Practice counting and exchanging money when you go to the store and at home during play. Try to use real money rather than credit cards when shopping with your kids.
Ages 8-10: Open a bank account and kid’s savings. Consider small jobs to promote the value of earning money. Require your kids to assume greater financial responsibilities. Focus on saving for longer-term goals. It’s time to open a custodial banking account with your child. Make sure you remind your kids that money is earned by working.
Ages 11-13: Develop budgeting skills. Instill the value of working with small jobs near home. Require your kids to begin planning for longer-term spending and saving goals. Share the importance of giving to others. Work with your child to broaden bank management skills.
Ages 14-16: Balancing financial wants and peer pressure. Balance needs, wants, and values as teens encounter significant peer pressure. Manage greater financial decisions, such as annual clothing purchases. Learn to plan, save and budget from personal earnings and allowance. Engage in discussions about college, including financial expectations.
Ages 17-18: Help your teen prepare for college or life after high school. Encourage them to manage more personal expenses to prepare as an upcoming graduate. Work part-time to build self-esteem, confidence, and experience. Balance social and college pressures within financial realities.
TNStars 529 Program
With the TNStars College Savings 529 Program, you can put aside money starting as early as the birth of your child to prepare for their future. The money invested in your TNStars account can be withdrawn tax-free to pay for qualified education expenses like tuition, housing, books and more at any school that accepts federal financial aid including trade or technical schools, community colleges, and four-year universities, both in-state and out-of-state. Get your little ones on the right path by opening a TNStars account at TNStars.com in 15 minutes with as little as $25 to start. If you meet certain income requirements, each of your children in your household may be eligible for up to $1,500 in matching grant funds through the Tennessee Investments Preparing Scholars Program. Learn more at treasury.tn.gov/tips.