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Money talks: 5 tips for teaching kids about personal finance – Lookout Santa Cruz

Imagine two teens walk into a big-box store to buy themselves a top-of-the-line laptop. One doesn’t have money saved, but he does have a credit card and an idea of what computer he’d like based on ads he’s seen on TikTok. The …….

Imagine two teens walk into a big-box store to buy themselves a top-of-the-line laptop. One doesn’t have money saved, but he does have a credit card and an idea of what computer he’d like based on ads he’s seen on TikTok. The other has a robust savings account, a debit card, and an idea of what computer he wants based on cost comparisons he did while researching his big purchase. Which do you think will leave in the best financial situation?

If you guessed Teen #2, you’d be right. While no child is exactly the same as another, they all have one thing in common: They need to understand the basics of money to flourish in life.

According to surveys, few parents (less than 15%) ever discuss managing student loans, preparing for retirement, or applying for auto or home loans with their kids.

(Getty Images)

In the United States, 47% of adults say they typically live paycheck to paycheck, according to a 2021 poll by the National Endowment for Financial Education. That means that nearly half of adult Americans are not prepared to handle an unexpected mid-size expense, such as a car repair or a medical bill.

As soon as the laptop example above becomes the purchase of a vehicle, an education, or a home, the stakes are raised. That’s why it’s important to start teaching your child about personal finance early.

Few parents (less than 15%) ever discuss managing student loans, preparing for retirement, or applying for auto or home loans with their kids, according to a recent survey.

According to a 2021 poll, 47% of adults in the US say they typically live paycheck to paycheck. That means that nearly half of adult Americans are not prepared to handle an unexpected mid-size expense.

(Getty Images)

The good news is that you don’t need to be perfect. You just need to help guide your child in the general direction of financial literacy. Let kids know that you are always open to talking about money and answering their questions. And if you don’t know the answer? You can always research together.

Here’s a collection of topics to explore with your child:

1. Earning

Encourage your child to think creatively about earning money, and help them understand their own earning potential.

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