People usually only worry about managing their finances after they get into debt. This is quite common among young adults, as they enter the adult world without any experience in terms of responsibility for their own money.
That’s why many schools have invested their time in preparing children for the future. However, if your child is already a teenager, don’t worry, because there are still ways to introduce this topic into their lives.
So today we will explain the importance of financial education for young people and teach them how to develop this skill in their daily lives. Let’s go! Keep reading!
How important is financial education for young people?
The main objective of financial management is to teach teenagers how to have a balanced adult life, where they can enjoy their money, but remember to save it in case something unexpected happens.
Even knowing this, it is common to have doubts about the importance of financial education for young people, since there are several layers to this subject. Therefore, check out below some reasons that make this education essential!
Discipline and organization
Imagine the following scenario: André is a boy who never had to worry about money during his adolescence, but he started working. When he received his first salary, he bought a video game console, without considering his fixed expenses.
After that, he buys at least one game per month, which ends up generating a debt that lasts throughout the year.
Now I propose that we analyze: could this situation have been avoided? Yes, especially if our fictional character had discipline in relation to his finances.
When we know our ceiling and organize this data, we open the doors to having an analytical vision, which means we can identify needs and desires.
That is, André could have paid his bills first to see if the remaining amount could be invested in a console.
If you realize that you don’t have enough to purchase this product, the ideal would be to create a savings plan with short, medium and long-term goals, to understand your priorities and organize yourself financially.
Social responsibility
It is a fact that money is the element responsible for moving our world. Knowing this and that it shapes social classes, financial education for children and young people helps in the development of social responsibility.
This happens because they understand the impact that their spending can have , making them make more conscious decisions, choosing to save and spend only when something is in line with their interests, as this teaching also encourages self-knowledge.
Autonomy
Every parent’s dream is for their children to have autonomy in all areas of their lives. When it comes to finances, it’s no different.
By adopting financial management habits during adolescence, young people acquire responsibility for their own accounts, which is a determining factor in ensuring a future with financial independence.
Self-control
Last but not least, we have self-control. As children develop, it is possible to see that there are several stimuli for children to acquire logical reasoning , making it easier for them to make more rational decisions, especially in mathematical matters.
All this knowledge helps with emotional self-control. That said, one of the important aspects of financial education for young people is related to awareness of their own finances, ensuring that it is not the end of the world if they cannot buy something they really want right now, as they are emotionally prepared for situations like this.
What can the lack of financial education for young people cause?
Debt directly affects emotions, as debts can become a cycle , resulting in the feeling that there is no way out of the problem.
How to develop financial responsibility in young people?
Now that you know the importance of financial management, we will give you some tips on how to develop a sense of responsibility in your children. Check it out below!
Teach the basics of saving
The concept of saving is taught from childhood, however, we often don’t even realize it. It is present when you gave your child their first safe as a gift or when you asked them to save money to buy that long-awaited “sneaker” or “toy”.
See? We just don’t use that name. However, during adolescence it is important to name this practice to prepare them for the future. Therefore, explain the basics and establish a financial plan with expenses and income, so that they understand in practice how the economy and investment work.
This teaching is related to the importance of financial education for young people, as this helps them to recognize the value of money.
Use play to teach about finances
Learning and playing are two concepts that go hand in hand, and are one of the best learning methods. Even if your son or daughter is in their teens, they will never refuse to play with you.
Luckily for you, there are two options that are familiar to all families and that can be used to teach financial management. We are talking about the famous “Monopoly” and “The Game of Life”. Take advantage of this moment to share teachings with your little ones.
Establish some activities to be paid for
It is impossible to talk about the importance of financial education for young people without mentioning the practice of rewarding them for activities they do. This practice is very common in many families, but if you are not yet a fan of it, take advantage of the opportunity.
Basically, just choose some tasks for your children to do , such as finishing at least 1 book a month or helping with the washing up.
Determine an amount for each category and every time they finish their tasks, they will receive that amount and must choose what they will do with that money.