Photo Credit: FabNFree.com
When I was a new mom (circa 2007), I worried a lot about this little human that God entrusted to us.
As I ruminated on life and how to be a good parent to E, one of the recurring thoughts I had was how ridiculous it was that I spent so many hours in school learning about higher math but not basic financial literacy!
So what did I do? I googled.
What is financial literacy anyway?
According to Investopedia
Financial literacy is the ability to use knowledge and skills to make effective and informed money management decisions.Personal financial literacy encompasses a range of money topics, from everyday skills such as balancing a checkbook to long-term planning for retirement.
How did we start E on the road to financial literacy?
E is at that age (9) where she knows what money is and she understands basic math. Building on what we learned about the power of habit, her dad and I decided to give her a weekly allowance.
We discussed the concept of tithing, saving, and spending. E decided on her own to save a whopping 60% of her allowance. On a personal level, this floored me. But as long as I remember, E has been very circumspect in spending, and has shown strong impulse control — unlike some person I know (ehem is that the mirror? Hahaha)
We gave E a weekly allowance starting May of this year. So far she has assiduously followed her title-save-spend ratio. In fact, she made 3 deposits in her bank account — she counted her money, filled up the deposit slip, fell in line, asked the teller for her account number, and changed her ATM PIN.
How about the concept of wants and needs?
Being 9 years old, E does not need to spend on her needs, so we discuss how she spends her allowance. She mostly buys books, cotton candy, and glue for slime.
E is in the super early stages of financial literacy, but I am happy that she already started.