We all have financial goals in life, however, some do not know how to achieve them. Teach your kids about financial goals and financial plans. By making short-term and long-term financial goals, plans can then be created to reach those goals.  For example, a new video game system may be on the wish list.

Questions to ask are:

How much will it cost?

How much can we save at a time?

How many months do we have to save for it?

Teach your kids how setting financial goals is a skill they will be using throughout their lives. They will most likely be doing this for the purchase of a car, vacation, holiday presents, home purchase, and retirement.

It is important to teach children about how to maintain good credit.

Help your teen to create a mock budget using a possible future income. Go over with them all of the expenses that an adult faces (rent/mortgage, credit card bills, taxes, health insurance, auto insurance, auto repairs, entertainment expenses, gasoline, etc.). Let them get a feel for how much one can afford and how to budget so you can have money left over. Share with them the strategies you use in order to manage your money.

Teach your children the urgency of keeping private information about themselves a secret. Credit card numbers, bank account numbers, social security numbers must not given out. Review with them what to do if their personal information is ever stolen.

Explain the difference between credit cards being a loan you have to pay back (usually with interest) and debit cards subtracting from your own funds. Also go over with them what to do if the card is lost or stolen.

Teach your kids how credit cards work. Most children view credit cards as free money which isn’t true so the sooner you can get them out of that mentality, the better of they will be in the future.

Review with them how the money must be paid back and how interest works. Make sure you also explain how some adults get trapped with debt by only making minimum monthly payments. Show them how different cards offer different interest rates.

Make sure you teach how to use an ATM. Also teach them how to do deposits and withdrawals in a bank branch.

It is important to teach kids the basics about banking. Discuss the purpose of having a checking account, savings account and bank certificate of deposit and how they all work. A great math lesson would be to make sure you mention how minimum balances, overdraft fees, ATM fees and interest rates work.