Financial literacy is just a fancy name for money knowledge. Many adults end up wishing they’d learned more of it in their younger days.
It’s easy to see how a lack of financial literacy can play out in adult life, with consequences that can be painful and last for years. According to a report from Ramsey Solutions, 49% of Americans said they have some difficulty paying bills, 54% have accepted that debt is a way of life and 34% said they are carrying more than $10,000 in consumer debt.
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You can help your kids get a good start with financial literacy through classes offered at school, community organizations or online platforms. And doing so could benefit not only their finances but yours as well.
Here’s a look at five ways these courses could help your own finances.
Also see 10 financial lessons boomers wish they’d learned sooner.
Habits for the Family
If kids gain more money knowledge, they’re likely to develop better financial habits. That’s good news for their parents.
The good habits kids develop with money may very well trickle down to other members of the family. “When a student is financially literate, they don’t just make smart decisions with their money,” according to Ramsey Solutions. “They build good habits that trickle down to their families, their communities and eventually the nation.”
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Better Budgeting
One of the good money habits your kids are likely to develop from financial literacy courses is to budget and save. That means they’re less likely to hit you up for money — now and in the future.
“Think about the jump start students could get on life if they were already budgeting, saving regularly and spending wisely — before they graduate! They could have thousands of dollars in the bank, a paid-for car, and the beginnings of a retirement fund,” according to Ramsey Solutions.
Other Benefits
Financial literacy classes can help your finances in other ways as well.
- Emergency savings: You’re likely to be able to put away more money as emergency savings when your kids learn the value of a dollar and start demanding less from you.
- Reduced clothing budgets: When your kids start to learn the value of money, perhaps from having their own part-time work, they’re probably going to spend less on things such as clothing.
- Better communication: You probably already know the importance of communication when it comes to family finances, and your kids are sure to learn about it as well through their financial literacy classes.
You can help supplement what they learn with activities at home and through your bank or other financial institution. According to Gulf Coast Educators Federal Credit Union, you could set up a youth account, which can help children establish good savings habits.
Further, you could teach good money skills to your kids through phone apps or by creating the family budget together.
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This article originally appeared on GOBankingRates.com: 5 Ways Financial Literacy Classes for Your Kids Could Help Your Finances
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