1) The document discusses the importance of teaching children financial literacy from a young age. It provides examples of ways to educate kids about money matters at different developmental stages, from preschool through high school. 2) Research shows that money habits are formed as early as age 7 and that children need help from parents to learn skills like saving and delaying gratification. 3) The document encourages talking to kids about earning, spending and saving money; opening bank accounts for children; and assigning age-appropriate chores with compensation. It stresses the importance of financial literacy education.

1. 8 LINKED NORMAN WEST OCTOBER 2014
I
n one of the final episodes of ABC’s
sitcom “Trophy Wife”, 8-year-old Bert
gets a credit card in the mail and goes
on a shopping spree. At one point in
the storyline, Bert tells his father, “You hate
your job; you should just get a credit card
instead.”
While it may be funny on the show,
fortunately for Bert, sending an unsolicited,
pre-approved credit card in the mail is now
prohibited thanks to the Credit CARD
Act signed in to law by President Obama
in 2009. What this anecdote highlights,
however, is the growing need for financial
literary for children.
Recent research from the University of
Cambridge indicates that money habits,
such as the ability to plan ahead and
delay gratification, are formed as early
as 7 years old. Children can recognize
saving as a desirable behavior, but,
according to research from the University
of Kansas, are unable to develop their
own savings capabilities until the age of
12 because of their stage of psychological
development. What do these two studies
mean for parents? Your children need your
help starting at a young age to become
financially responsible adults!
Here’s what you can do:
PRE-SCHOOL
“When my children were young, I created
a currency for each of my kids using
inexpensive business cards I designed online.
This allowed me to give an immediate
“monetary” award to each of them when
they earned it. Each of my children had their
own currency design so that the currency of
one child would not end up mysteriously in
the collection of my other child.”
-Amy Lee, Executive Director of the
Oklahoma Council on Economic Education,
parent of two
Help your child delay gratification by
saving treats for later. Open a pack of
cookies or other snack, take out a serving
size, and discuss saving the rest for later.
Take your child to the store and bank
with you. Teach your child that you need
money to buy things and you get money by
working.
Assign your child age and stage appropriate
chores, such as putting toys back in the
toy bin, and provide a small allowance or
commission for completing the chore. For
younger kids, it is important to pay for
chores immediately.
ELEMENTARY SCHOOL
“The more you save, the more money you
have. It is important to put your money in
a bank so that you won’t spend your money
on the little things you think you need at the
time like nail polish I saved my money for
Sage, an American Girl doll. Sage means
more to me because I bought her than she
would have it she was given to me as a gift. I
take good care of Sage because I worked hard
to get her.”
-Crystal Serrata, 4th Grade Student at
Northwood Elementary in Piedmont
Open a savings account in your child’s
name and visit the bank to make deposits
regularly. Bank accounts are safer than
the sock drawer or a piggy bank. When
your child wants to make a substantial
withdrawal to purchase the new fad,
remember it’s OK to say “NO.” It’s easier
to save as an adult when as a child you get
in the habit of putting at least a dime of
every dollar they make (allowance, gifts,
etc.) into their savings account. Practice
the mantra: “Save Some, Spend Some, Share
Some.” One practical and hands-on way is
to get three Mason Jars labeled Save, Spend,
and Share and have your child divide each
dollar between the three (with at least 10
percent to each the save and share jars).
Read with your child and point out the
financial and economic themes of children’s
literature. You would be surprised how
often money themes (getting a job,
working, getting paid and buying things)
come up in the books your child reads.
This is a great time to discuss the benefits
of saving, how your child can make money
around the house, and how to save to buy
things.
Children should do some chores around
the house for free just for being a part of
the family (making their own bed, cleaning
their own bathroom, cleaning their own
dishes, etc.). Allow your child to earn
money around the house by doing extra
chores in addition to their own (making
your bed, cleaning your bathroom,
doing all of the dishes, etc.). Do not give
advances and do not pay your child for paid
chores until the unpaid chores are finished.
It is important for kids to understand the
connection between work and money at an
early age.
MIDDLE SCHOOL
“Over the summer between eighth and
ninth grade, I was able to clean some of the
neighbors houses, help mow their lawn and
Financial Re$ponsibility
TEACHING YOUR CHILD HOW TO HANDLE MONEY FROM A YOUNG AGE
DID YOU KNOW?
$211 Billion: Spending power of 8-24 year olds (Harris Interactive)
Fastest Age Group Filing for Bankruptcy: Those Under 25 (Lusardi, Mitchell, & Curto,
2010).
US Student Loan Debt ($1.2 trillion) = GDP of Mexico ($1.17 trillion) (Credit Abuse
Resistance Education, 2014)
Average student loan debt: $33,424 (Federal Reserve of New York, 2014)
Average credit card debt of indebted US households: $15,480 (Federal Reserve of New
York, 2014)
Average mortgage debt for US households: $156,474 (Federal Reserve of New York,
2014)
Number young adults that possess basic financial literacy: 33% (Lusardi, Mitchell, &
Curto, 2010).

2. LINKED NORMAN WEST 9WWW.LINKEDOK.COM
other ‘around the house things’, that they
needed help with. A lot of it was family
friends or just friends in general.
I earned a little over $300 dollars through
my work and time. The earnings will help
me participate in marching band. I learned
that not everything is so easy, but sometimes
it’s very much worth it if you put the time
and effort, and responsibility towards what
you are trying to achieve. In this instance I
was trying to pay off my band fees.”
-Michael Chowning, 9th Grade Student at
Union Ninth Grade Center in Broken Arrow
If your child has ever witnessed you swipe
a card, sit down and point out that your
bank statement shows money coming out
of your bank account or have your child
watch you as you write a check or pay your
credit card. Just like Bert in “Trophy Wife”,
children need to be taught that credit cards
are not free money and that credit cards
are an expensive way to buy things if you
do not pay them off each month. Help your
child learn to not make purchasing on
credit cards that they could not pay for full
in cash.
In addition to the dangers of online
predators, help your child understand the
threat of identity theft. Sharing personal
information online, like a birthday, social
security number, or bank account, is risky
because someone can steal it. Middle
schoolers should know to not respond to
emails that look like they are from banks,
credit card, or cell phone companies asking
for account information because they are
likely fraudulent.
Help your child recognize opportunities
to earn extra money around the
neighborhood. This could be a lawn
business, babysitting, or reselling a bulk box
of candy from Sam’s Club to friends.
HIGH SCHOOL
“Personal Financial Literacy is a class that I
do not need to ask why I need to know this or
why is this important. I use money every day
and will continue to use money every day of
my life. The class is helping me develop strong
money management skills and will help me
stay out of debt.”
-Johan VonMarton, Senior, Putnam City
West High School in Oklahoma City
If your high school student’s school
offers a course in personal finance, sign
them up! Did you know that because
of the Oklahoma Passport to Financial
Literacy Act of 2007, Oklahoma students
beginning with the class of 2014 are
required to demonstrate proficiency in
personal finance? If your child’s school
does not offer personal finance, ask the
principal what the school is doing to meet
the Oklahoma Passport Standards. Many
banks and credit unions offer schools guest
speakers to discuss the topic of financial
literacy with all grade levels.
A part-time job builds work ethic. High
school is a crucial time to continue the
idea of Money=Work. There are a limited
number of employers willing to hire 14 and
15 year olds with a work permit. The job
market opens up for teens at 16, especially
in movie theaters and some restaurants.
Help your high schooler understand the
importance of investing in their retirement
early in adulthood. Ask a banker, credit
union counselor, or insurance agent
you trust to refer you to an investment
professional. A mutual fund in a Roth IRA
is an easy way to start turning saving into
investing.
Brent Rempe is a former middle and high
school Personal Financial Literacy Instructor
and currently serves as Director of Education
for WEOKIE Credit Union.