April is National Financial Literacy Month. We will be dedicating the entire month to inform our readers about topics and tools they can use to learn how to effectively handle money as well as deal with debt.
It is not surprising that America as a whole has money issues. According to the Federal Reserve the US National Debt is $21 trillion and counting. Below is a break-down of personal debt which will have changed significantly even after I publish this blog post. I cannot say that I am surprised but seeing these numbers are slightly alarming don’t you think? These numbers tell me that we as American people don’t have our priorities and maybe even values straight. We live beyond our means. More than that these numbers tell me we have a lack of financial education. I’m not going to play the blame game for who is responsible for the lack of financial literacy. I do however want to convey the importance of financial literacy and how being financially literate can secure a successful financial future. In this post you will find 10 resources that will help you and your child become money smart!
Total Personal Debt: $18 trillion
Mortgage Debt: $15 trillion
Student Loan Debt: $1.5 trillion
Credit Card Debt: $1 trillion
Personal Debt Per Citizen: $58,000.00
Why Does Financial Literacy Matter?
Financial literacy is the knowledge of managing debits and credits in order to make sound financial decisions. When we talk about financial literacy we are talking about spending, saving, budgeting, establishing credit, investing, retirement, insurance, and fraud protection. That list might look intimidating but those topics are about everyday life skills. Knowing how to manage money correctly and acting on it can establish a solid foundation that will last a lifetime. Being financially literate can give you financial freedom and stability.
The lack of financial literacy results in being unable to control money and allowing money to control you. Not being financially literate may lead to living paycheck to paycheck because of debt, inability to purchase things such as a car or house, inability to rent an apartment, foreclosure, and bankruptcy, incapability of retiring. The lack of financial literacy can also lead to insecurity, anxiety, stress, frustration, strained marriage, and strained relationships. Don’t be in dismay there are plenty of things you can do to prevent some of the negative results of the lack of poor money management.
Usually the knowledge of money management comes from parents. Our children watch how we save, spend, borrow, and give money. Being financially literate is a life skill that should be taught by parents. Sometimes parents are uncomfortable talking about money. Some feel inadequate to teach their children about managing money; however the thing is they are already learning by watching you. So give them the best advantage by coming along side them and help them have a healthy financial future. You might learn something along the way.
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10 Helpful Resources to Secure Your Financial Future
Financial literacy should start at an early age, as early as pre-school and continue on into adulthood. There is no need to get overwhelmed or be intimidated by teaching your child about finances. There are a lot of free and fun resources available. Here are 10 resources that will help you and your child become money smart!
1. Guide to Securing Your Child’s Credit Future – The Simple Dollar in collaboration with Reviews.com
The guide is useful for parents to help teach their children good financial habits and credit building concepts. It is broken down into four stages of development ranging from preschool to high school age. Also within the guide outside resources are provided for additional educational materials.
2. 20 Things Kids Need to Know to Live Financially Smart Lives - Money As You Grow
This contains two downloads. The first download consists of the 20 things kids need to know and is broken down by milestone ranging from age 3 to 18+. The second download is also broken down by milestone with the 20 things kids need to know but it also has activities that you and your child can do together.
3. How Kids Develop Money Skills – Consumer Financial Protection Bureau
This website provides conversation starters, activities, and online games and resources. The information is broken down into building blocks of development beginning with early childhood and ending with adulthood.
4. Dollars & Sense – H&R Block
This is a great resource that provides lesson plans for teacher, parents, and students. The topics covered are budgeting, reading a paycheck, understanding taxes, 401(K), insurance, savings, payment methods, credit, and loans. Along with each lesson plan is an activity. Each lesson plan and activity is downloadable in PDF form. Also provided on this website are family discussion questions.
5. The Mint |It makes perfectcents - Northwestern Mutual
This website is super interactive with calculators, challenges, and quizzes. There are sections for kids, teens, parents, teachers, and grads. What I like about The Mint is the parent section. As a parent you are able to check your financial IQ. There is a parenting guide and teaching tools to help you and your child understand money.
6. themintGRAD - Northwestern Mutual
Geared for twenty-somethings, recent grads, and young professionals, this resource teaches how to be money smart and plan financial goals. Topics discussed are income and career, budgeting basics, managing your money, practical investing, and lifestyle planning. In the planning section of this website you can set goals for start saving, building positive credit, or pay down student debt. If you would like to set any of these goals, themintGRAD will walk you through step by step with a series of questions to help you plan your goal. It also has fun quizzes and calculators.
7. 6 Money Lessons Kids Need before Leaving Home - Smart Family Money
This is a blog post from a mom who likes to help families save money and budget so they can live a life with less worry and more fun. Don’t we all want that? I really like this post in particular because the 6 money lessons are based on wisdom from parents.
8. Practical Money Skills - VISA
This website is loaded with a ton of helpful information. This information covers all things financial for each stage of life and life events. There are calculators, apps, games, guides, lesson plans, comics, and videos.
This money guide is geared toward late elementary and middle school age children. In this guide you will learn to earn, save, budget, spend, borrow, protect and give. Each section is interactive with questions to answer. When using this guide your child can actually set short-term and long-term savings goals and create a budget.
The lesson plans range from Pre-K through college. There are teacher guides and student activities which are both downloadable.
9. bizKID$ - Biz Kids, LLP
Biz Kids is an Emmy nominated show that is about kids teaching kids to be money smart. The show is geared toward middle school and high school students. The website provided has clips of all 6 seasons of the show. A lesson plan is provided with each show. There are also interactive games. Your children will learn budgeting basics, credit, insurance, taxes, saving, how to make smart purchases and avoid debt.
10. Get Financially Fit – Nelnet
The Get Financially Fit webpage provided by Nelnet is focused on high school and college age. Worksheets, tips and other resources are provided in downloadable form. Topics covered are budgeting, financial wellness, credit cards, identity theft, and student loans. The Live Life Smart Guide is pretty helpful.
As you can see financial literacy is a big deal and is an extremely important factor for having a worry free and financially secure life. Make sure you read that correctly, it’s an “important factor”; just because you know how to budget, save, and build good credit doesn’t mean it is going to be rainbows and unicorns the rest of your life. However it will help you to make the best informed decision about your personal finances you can make at that time. Having good money management will give you the freedom to do more things and help others along the way. Having the skills to manage money will benefit your child for a lifetime.
Do you know of any good financial literacy resources? Do you talk with your children about personal finances?