Gibraltar Private Bank & Trust Provides Tips for Parents to Shape Financial Skills for Children
70% of parents believe that good money habits are essential but only 28% of parents felt that they have taught their children good money skills. With these statistics in mind, Gibraltar Private Bank & Trust makes recommendations to help families.
Coral Gables, FL - The ongoing financial crisis in the U.S. has made most families, regardless of economic status, take a close look at their finances and even the wealthiest families should be having realistic conversations about money with their children. While these discussions can be uncomfortable, Gibraltar Private Bank & Trust (www.gibraltarprivate.com) suggests that parents take the initiative to provide financial life skills to their children, because these important lessons will help shape a child’s understanding of how money is earned and spent.
A recent USA Today survey showed that 70 percent of parents believe that good money habits are essential but only 28 percent of parents felt that they have taught their children good money skills. With these statistics in mind, Gibraltar Private Bank & Trust recommends the following tips for getting children involved in conversations and decisions regarding money.
Elementary school age:
- Take children shopping and discuss the comparative cost of items. Also show them online comparison shopping websites. Kids will learn to look for the best value and will get excited about the challenge.
- Teach younger children how to count change and give them the opportunity to experience this when you are shopping together.
- Give gift cards for presents and permit the child to make the purchasing decision while limiting the choice to whatever amount is on the gift card. No additional funds should be added.
- Open a savings account and educate children about interest they earn.
- Create opportunities for children to earn money by posting jobs around the home for pay so that they learn about working for purchases they might want to make and which would not be possible from just an allowance.
High school age:
- Invite your child to submit a yearly budget over which you maintain line item veto rights. Your child needs to stay within these limits unless he or she earns additional money beyond the budget or if a special family function necessitates a purchase which was not anticipated. Requiring a budget but allowing your child to ignore the consequences of exceeding the budget is teaching a very harmful and counterproductive lesson.
- When appropriate, place funds in a checking account which children must successfully manage, avoiding any overdrafts. Require that the account be balanced every month, before the next allowance is added. Online banking can help them stay organized.
- Start a family investment club and become educated in the world of investing as a group. You’ll be surprised how much your young children can learn about the world of stocks, bonds, certificates of deposit, and money market accounts.
About Gibraltar Private Bank & Trust Established in 1994, Gibraltar Private (www.gibraltarprivate.com) is an integrated private banking and wealth management company dedicated to enhancing the wealth and well-being of its clients and their families. Gibraltar offers residential and commercial lending, private banking and wealth management services to professionals, corporate executives, entrepreneurs, affluent retirees, and select businesses. Gibraltar Private has eight full-service banking offices with its headquarters in Coral Gables, offices in Fort Lauderdale, Miami, Miami Beach, South Miami, Naples, Ocean Reef and New York, and a loan production office in Aspen, Colorado.
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