In honor of Financial Literacy Month, let us talk about how important it is to teach our children financial literacy. The impact our finances have throughout our lifetime on the way we live is immense, that is why it's never too early to start learning about money. Since the 2008 financial crisis, financial literacy programs have skyrocketed. Schools are developing financial literacy curriculums and after school programs, while many non-profit and for-profit organizations are also taking this initiative.

Financial Literacy in Schools
Carol O'Rourke, Executive Director at The Coalition for Debtor Education, an independent non-profit housed at Fordham Law School, teaches financial literacy at city schools in New York through a game called Financial Jeopardy.

"We use a game show format, with categories like saving, banking, safety, and needs and wants to get the students engaged," she says.

Exciting Classes
They are expecting a boring class, says O'Rourke, not a lively discussion about if a cellphone is really a "need" or if a student loan is a good investment. The class is divided into teams, so everyone gets involved and it becomes competitive, with everyone vying to get the most points. The discussions are interesting to the students because they talk about the things that they spend money on now.

Credit Card Debt
The "2012 Financial Literacy and Credit Cards: A Multi Campus Survey," published by the International Journal of Business and Social Science found that 70% of undergraduate college students had a credit card and just over a third (33.9%) had only one credit card. This leaves approximately 36% of college students with two or more credit cards. However, according to the survey, only 9.4% of students paid their credit card in full each month, leaving most students (90%) with some indeterminate amount of credit card debt each month, subject to high interest and other charges. Given these troubling statistics, it's very important to teach children, while they're still young, to stay away from debt and show them the best ways to handle the money they receive from babysitting, delivering newspapers or any other part-time jobs that college-aged people tend to have.

The Bottom Line
Teaching children about financial literacy is very important if you want them to grow up to be financially responsible adults. Kids will take a greater interest in financial literacy if the topic is engaging and fun. However, nothing is more important than making open money conversations a regular part of their upbringing.

Related Articles
  1. Fundamental Analysis

    5 Basic Financial Ratios And What They Reveal

    Understanding financial ratios can help investors pick strong stocks and build wealth. Here are five to know.
  2. Investing

    7 Creative Ways to Save for an Early Retirement

    Take note of these out of the box steps you can take towards securing yourself an earlier, more comfortable retirement.
  3. Investing

    What Investors Need to Know About Returns in 2016

    Last year wasn’t a great one for investors seeking solid returns, so here are three things we believe all investors need to know about returns in 2016.
  4. Retirement

    Birch Box Review: Is It Worth It?

    Learn more about the convenience of the subscription beauty box industry, and discover why the Birchbox company in particular has become so popular.
  5. Economics

    The Basics Of Business Forecasting

    Whether business forecasts pertain to finances, growth, or raw materials, it’s important to remember that a forecast is little more than an informed guess.
  6. Investing Basics

    How to Become A Self-Taught Financial Expert

    Becoming a self-taught financial expert may not be as daunting of a task as it seems.
  7. Economics

    Forces Behind Interest Rates

    Interest is a cost for one party, and income for another. Regardless of the perspective, interest rates are always changing.
  8. Investing

    New Year, New Investing Strategy: Exploring ETFs

    Whether you’re a seasoned investor or new to the markets, you need to learn as much as you can about the present environment and how to navigate it.
  9. Term

    How Statistical Significance is Determined

    If something is statistically significant, it’s unlikely that it happened by chance.
  10. Personal Finance

    University Donations: Which Schools Got the Most

    A closer look at the staggering $40.3 billion donated to colleges and universities in 2015.
RELATED FAQS
  1. What is finance?

    "Finance" is a broad term that describes two related activities: the study of how money is managed and the actual process ... Read Full Answer >>
  2. What is the difference between positive and normative economics?

    Positive economics is objective and fact based, while normative economics is subjective and value based. Positive economic ... Read Full Answer >>
  3. What's the difference between microeconomics and macroeconomics?

    Microeconomics is generally the study of individuals and business decisions, macroeconomics looks at higher up country and ... Read Full Answer >>
  4. What’s the difference between the two federal student loan programs (FFEL and Direct)?

    The short answer is that one loan program still exists (Federal Direct Loans) and one was ended by the Health Care and Education ... Read Full Answer >>
  5. Student loans, federal and private: what's the difference?

    The cost of a college education now rivals many home prices, making student loans a huge debt that many young people face ... Read Full Answer >>
  6. Can I use my IRA to pay for my college loans?

    If you are older than 59.5 and have been contributing to your IRA for more than five years, you may withdraw funds to pay ... Read Full Answer >>
Trading Center