One incentive to get children to save is to match their savings contributions dollar for dollar. Other options include matching 50 cents for each dollar saved...or even two dollars for every dollar saved. Of course, you get to set the rules and can choose any amount you want.
The important part of matching contributions is that you are creating a built in incentive to encourage saving behaviors. You can also establish guidelines for spending once a matching contribution has been made. While it is important to monitor how the savings match is being spent, it is also a useful way of teaching other important money related lessons such as planned spending, understanding the difference between wants and needs, etc.
As a parent, your ability to match savings depends on your own financial situation. The good news is that no matter how you decide to structure a savings match for your children, the end result is that they will be more money savvy and develop an understanding of just how important savings really is.
Tuesday, July 14, 2009
Wednesday, July 8, 2009
Do Parents and Young Adults Ever See Eye to Eye?
Do parents and their young adult children always agree? Obviously not. Where is the fun in venturing out into the world of adulthood without a little disagreement or two regarding important life views? It is not a huge surprise that parents and children have opposing views regarding money matters.
A recent Wells Fargo study indicated some alarming results on how parents and children differ in their views toward personal finances. Apparently the majority of parents (about 95%) are confident their children will attain their financial goals as they enter adulthood. Unfortunately, only 5 percent of the young adults surveyed said they had such confidence about their personal finance goals.
Why such a huge difference in confidence levels? Parents should always want the best for their children. A desire for children to have the best in their lives is a common goal of most parents.
The Wells Fargo survey is one of many recent studies that show the financial knowledge and education regarding financial matters is lacking in our youth. As children graduate high school and enter their college years many lessons have yet to be learned regarding personal finances. For many, the school of hard knocks will be the primary educator. Studies like the Wells Fargo survey indicate a need to start the learning process as early as possible. Parents and educators must work hard to close the generational gap related to money management.
A copy of the Wells Fargo survey report is available at https://www.wellsfargo.com/press/2009/20090616_study.
A recent Wells Fargo study indicated some alarming results on how parents and children differ in their views toward personal finances. Apparently the majority of parents (about 95%) are confident their children will attain their financial goals as they enter adulthood. Unfortunately, only 5 percent of the young adults surveyed said they had such confidence about their personal finance goals.
Why such a huge difference in confidence levels? Parents should always want the best for their children. A desire for children to have the best in their lives is a common goal of most parents.
The Wells Fargo survey is one of many recent studies that show the financial knowledge and education regarding financial matters is lacking in our youth. As children graduate high school and enter their college years many lessons have yet to be learned regarding personal finances. For many, the school of hard knocks will be the primary educator. Studies like the Wells Fargo survey indicate a need to start the learning process as early as possible. Parents and educators must work hard to close the generational gap related to money management.
A copy of the Wells Fargo survey report is available at https://www.wellsfargo.com/press/2009/20090616_study.
Thursday, July 2, 2009
Financial Literacy: Making the Case for Home-Based Instruction
Parents have enough to worry about these days. Finding balance between work and family life obligations is a major challenge. Managing personal finances with a growing family also presents additional obstacles during the financial life planning process. Sometimes it is hard to fit basic financial education into the family agenda.
One thing is becoming more and more clear regarding the topic of financial literacy. If you want your children to learn about managing money you cannot rely on the public school system in America to get the job done. Home schooling your kids on money matters is the best way to make sure they learn important life lessons about money. This does not mean that you keep them out of the school system. Just do not rely on the public school system and increasing financial literacy awareness to get the job done.
A recent back-to-school cardholder survey from Visa revealed that:
• Only 5% of adults learned about the vital life skill of money management in elementary or high school.
• Less than half of people (48%) learned about money management from their parents, while 41% were self-taught or learned the hard way.
• 91% of respondents said they supported requiring financial education be taught in every high school in the country. Currently just fifteen states have some sort of financial education requirement for high school students.
While it is important for more schools to embrace financial literacy programs, the best source of education is in the home. It is a telling sign that only 5% of adults surveyed learned basic money management in school. Do you think that has any relationship to our country's existing love affair with debt?
All parents and adults need to take the time to educate future generations about how to manage their money. For many already experiencing financial struggles, now may be the time to take control of their own financial future. During good and bad financial times children are watching and observing how parents and adults behave when it comes to money related matters.
Scott M. Spann, CFP(R), EA
scott@lifespanplanning.com
Source: Visa, Visa Back-To-School Survey Finds That Only 5% of Kids Learn Vital Life Skill of Money Management in Class, August 2007, http://www.practicalmoneyskills.com/english/presscenter/releases/081307.php
One thing is becoming more and more clear regarding the topic of financial literacy. If you want your children to learn about managing money you cannot rely on the public school system in America to get the job done. Home schooling your kids on money matters is the best way to make sure they learn important life lessons about money. This does not mean that you keep them out of the school system. Just do not rely on the public school system and increasing financial literacy awareness to get the job done.
A recent back-to-school cardholder survey from Visa revealed that:
• Only 5% of adults learned about the vital life skill of money management in elementary or high school.
• Less than half of people (48%) learned about money management from their parents, while 41% were self-taught or learned the hard way.
• 91% of respondents said they supported requiring financial education be taught in every high school in the country. Currently just fifteen states have some sort of financial education requirement for high school students.
While it is important for more schools to embrace financial literacy programs, the best source of education is in the home. It is a telling sign that only 5% of adults surveyed learned basic money management in school. Do you think that has any relationship to our country's existing love affair with debt?
All parents and adults need to take the time to educate future generations about how to manage their money. For many already experiencing financial struggles, now may be the time to take control of their own financial future. During good and bad financial times children are watching and observing how parents and adults behave when it comes to money related matters.
Scott M. Spann, CFP(R), EA
scott@lifespanplanning.com
Source: Visa, Visa Back-To-School Survey Finds That Only 5% of Kids Learn Vital Life Skill of Money Management in Class, August 2007, http://www.practicalmoneyskills.com/english/presscenter/releases/081307.php
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