Millions of American children are not ready for adulthood. Roughly one-fifth of U.S. children do not meet baseline levels for financial literacy proficiency.
In other words, they’re not ready to make a budget, handle monthly rent, and pay off student loan debt. They’re not ready for so-called “adulting,” when young adults are forced to take responsibility for their own lives and set themselves up for a cost-effective lifestyle.
That’s why personal finance is so important. On average, students who are required to take personal finance courses have better credit scores and lower rates of debt delinquency as young adults. They are also more likely to develop decent savings habits.
But parents can’t just rely on school. Only 17 U.S. states require a course in personal finance, leaving millions of students unequipped for the real world.
Fortunately, you can teach sound financial habits at home—and it works. According to a T. Rowe Price study, young adults who discussed money with their parents are not only more likely to have a budget and an emergency fund, but they’re also more likely to save for retirement. These young adults are better prepared to save 10 percent of their income instead of wasting it.
Parents can prepare their children by teaching them on a daily basis. There’s no crash course in personal finance—it should be taught whenever life presents teachable moments. Stuart Ritter, a senior financial planner at T. Rowe Price, put it this way: “This shouldn’t be ‘The Money Talk’ the day before they go off to college—it’s about everyday teachable moments, starting early and covering all of the topics.”
The more you teach your children, the wealthier they will become.
The teaching should start at an early age, when the kid ask for the first box of candies that was advertised on TV.
What is wrong with my comment, you ask for a comment, I gave you my comment with no bad language,words or insults.
Nothing wrong with your comment–We just didn’t manage to get on and approve over the weekend.
Great comment & a fact verified by what we see everyday! They want to change things they have no in-depth understanding of, nor do they have any idea of what change they KNOW will “work.” (and still allow us freedom of some sort)
James Kemper: in today’s UPSIDE DOWN world, words, though totally ACCURATE and TRUTHFUL, but disagree with the favored doctrine of the left are verboten!
It appears it isn’t ONLY the kids that aren’t ready for adulthood, neither are too many of their parents. Their limits on spending are the debt limits or the credit limits imposed on them. They drain their equity by refinancing their homes to fund their lifestyles. They commit to car leases and buy up to maximum of their credit cards and any other time payments which consume their ENTIRE monthly INCOME. They have no available funding for an emergency, no savings, no “rainy day funds, with every penny of their income committed to payments. Student loans don’t only affect recent graduates. Many adults are saddled repaying the outrageous student loans they used to fund their generous life styles during their college years, now extending well beyond 4 years to graduate with a BS or BA degree. Many are still paying down student loans well into their 50’s and even 60’s!
DEFERRED GRATIFICATION is a long lost concept!
Heard on the radio this comment & it applies to finances (& just about everything else in life)…”You either live a life of discipline or a life of regret”…can’t think where it doesn’t apply. When talking to people in their 50’s, 60’s, & 70’s who haven’t saved much…they definitely are regretting..but they hide behind “Well, we enjoyed life (as in, “live for today”) or my other favorite “I didn’t know about how to save.” HUH? every heard of a piggy bank? (for starters).
Teens should follow the example that Congress and presidents set for them.
On second thought …
DONRS you are so right! Also ever hear of “Live within your means” or “Save your money” – not really revelations of any sort, but heard those words of advice from my very wise Dad & they have served me well.