A blog written with parents in mind
Get In the Game!
Do you think your kids will be better off financially than you are once they reach your age? If you said yes, you're in agreement with more than half of parents and kids (ages 8 to 14) according to a survey released by T. Rowe Price. The 2015 Parents, Kids & Money Survey revealed that although the frequency of conversations about money has stayed steady over the past few years, the lessons parents are sharing often focus on short-term needs versus the habit of saving for long-term financial security. And with more than half of parents not actively saving for retirement or maintaining an emergency fund, it's time for parents to step up to the plate. To help you and your kids get into the game, T. Rowe Price has prepared the following tips to use when teaching kids about money:
- Always begin by setting goals—Talking about saving for a summer vacation is a good place to start the goal setting conversation, but parents also need to explain the importance of setting long-term goals, like saving for higher education, a car, or even retirement. To help young children with this concept, put it in terms they understand. Have two piggy banks for your children, one for short-term goals, such as a treat at the candy store, and one for long-term goals, like a new bike.
- Lead by example and use everyday situations to spark the conversation—Be a good role model to improve your kids' chances of learning smart financial behaviors. Our survey found that while parents and kids agree that a good education and hard work are key factors to financial success, they disagree about how important a role financial knowledge plays in future success.
To help kids understand how good decision-making can pay off, take advantage of small teachable moments. For instance, instead of ordering delivery pizza for dinner, make homemade pizza or buy a frozen one and discuss how spending your money wisely now can lead to a benefit later. Then, point out how you can also get ice cream for dessert because you saved so much on dinner.
Discussions about money do not always have to be planned. In fact, the best lessons come from real-life situations. Whether it's using coupons at the grocery store, balancing a checkbook, or comparison shopping for a new television, there is always an opportunity to teach a valuable money lesson.
- Encourage fun learning on their terms—Kids are ready to get off the bench and start learning about financial goals and how to manage their money. Kids agree that an online game would be helpful to learn the basics of saving and spending.
In addition to the free games and activities in the Kids section of this website, T. Rowe Price developed the Star Banks Adventure® game that is focused on smart planning and wise investing. Take a moment to check it out and see how your kids can learn about financial concepts—and have fun doing it. Kids will solve puzzles, answer quiz questions, and use "power-ups" to triumph in this game.
By taking advantage of online games and resources and making financial concepts part of your everyday activities with your family, you can set your kids up to be true financial all-stars!