Teaching Kids How to Financially Fly without Crashing First

How do you make boring topics fun? Better yet, how do you make boring topics fun in a way that also promotes learning? Educators face this challenge every day. It’s also a key question for parents and financial planners in teaching kids about money.

One of the most common worries we hear from our clients is that their kids are going to learn about money the hard way—by either losing it or getting into serious debt. Our usual response to this concern is that learning about finances doesn’t have to be a painful lesson. We then encourage parents to give their children the opportunity to manage money before it’s officially deposited into their piggy banks or personal checking accounts. This simple solution is based on all the many years we have observed children eventually grow into financially responsible adults through their participation in realistic money experiences, the more entertaining the better. In fact, there’s an official term for this concept in education called ‘realia’ and, believe it or not, there are financial literacy programs in the Pacific Northwest that use this teaching method.

Recently, NPR did a series called “Money Counts: Young Adults and Financial Literacy” that featured a story on the Auburn-based chapter of Junior Achievement, a national financial literacy program. What makes this local learning center unique is its theater-like staging of the real world where kids are given a typical money scenario, a pile of pseudo-dollars and a competitive challenge to make the soundest purchasing decision(s) possible. This may or may not sound like a good time, but there’s actually a tremendous amount of student enthusiasm and what looked like some serious fun. Kids can participate either through their school or by signing up for one of Junior Achievement’s many local programs.

Putting financial literacy programs aside, as parents you probably already know that teaching your kids about money is an ongoing process. The degrees of formality for these conversations range from the casual kitchen table to the structured financial advisor’s office. Either way, the opportunities for real life money lessons are endless. By providing these experiences before your kids fly solo in the adult world, they should be able to financially glide through life without crashing.