April is Financial Literacy Month in the United States. The month initially started with a focus towards financial education for children and has now shifted to provide resources for people regardless of age. Let’s learn more about financial literacy, why it’s celebrated, and how to get your children involved.
What is financial literacy?
Financial literacy is possessing the skills and understanding to make good financial decisions. When you understand your money and personal finance even at a very basic level, you make better choices. Financial literacy continues to be a focus and now is even becoming more prominent in schools. For many years, financial literacy was not taught or focused on unless it was done in your home. Now the true importance of financial literacy is becoming increasingly clear.
Why is Financial Literacy Month celebrated?
Financial literacy month began to be celebrated as a way to raise awareness and increase the focus on financial education. In 2004, the US Senate turned Financial Literacy for Youth Month into National Financial Literacy Month to promote events and educational information around money and getting out of debt. Today, many non profit companies and even some for profit companies continue to recognize Financial Literacy Month in an effort to provide resources and help the community better understand their finances.
According to NerdWallet’s study, the average credit card debt in the US is $6,929, the average student loan debt in the US is $47,671, and the average car loan debt in the US is $28,033. Even using just this survey, there are tons of people in the US who could benefit from additional financial education and knowing that they have the power to change their financial situation. As Dave Ramsey says, “if you’re the problem, that means you’re also the solution”. You should find comfort in knowing that you have the power to take control of your situation and change it. A new study by Salary Finance found “half of US Workforce Suffers Panic Attacks and Depression Due to Money Worries.” By taking control of your money, you can take back your life.
How can I include my children in Financial Literacy Month?
Children pick up a lot of financial habits from their parents–whether you think they’re paying attention or not. It’s a good idea to start being aware of the things you say about money when your kids are around. Do you tend to use money as an excuse for why they can’t get that new toy? Maybe instead shift the focus to talking about needs versus wants or even talk about budgeting. If you focus on the budget, instead of your kids hearing “we can’t afford that”, they’ll hear “that isn’t in our budget.” The message on the surface is very similar, but when you dive deeper, the second response sounds like you are making a choice for the family and the first sounds like you’ve got no choices available to you. Now that’s a little bit of an exaggeration, but regardless of how much money you truly have it might be better for your kids to feel like it is a choice within your control.
As your kids get to be school aged, it can be helpful to introduce the concept of your money doing 3 basic things: give, save, spend. You can set them up with envelopes, cans, or jars for each purpose and help them understand the importance of each category. Then as holidays or their birthday comes around, remind them that some needs to go in each category. For the give money you can help your child understand the importance by talking about what some local charities do. Popular charities for children often help animals or other children in some way, but you can also pick a charity that is important to you and help your child get involved.
Is there anything special available for financial literacy month?
Yes! As a special bonus in honor of Financial Literacy Month, Big Picture Budget’s 1 hour Financial Makeover Course is discounted to $25 with coupon code 20WEB. This course is designed for beginners who don’t know much about money. By going through this course and implementing the steps, you’ll go from clueless about money to budget pro in under 30 days. When you complete this course you’ll get information about budgeting, debt, and how to be successful as well as your very own budget template with instructions so you can create your own budget to help you work to achieve your financial goals.
Whether or not you celebrate Financial Literacy Month in April, it’s important to recognize the overall impact money has in your life. Taking the opportunity to gain education and learn more about your money and how you can use it to achieve your goals. Learning is never ending and it’s important to teach your kids and yourself about money.
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