The earlier kids start learning basic financial skills, the better their financial health in the long run, according to research.
When it comes to teaching kids about money, caregivers are asking for help. In fact, 32% of parents are uncomfortable speaking about finances with their own children and 46% are looking for additional resources to help encourage good financial habits, according to a Chase survey of parents across the U.S., with children aged 8-14.
Traditionally, kids learn about money from shopping with adults and having related conversations. While discussions are an important part of learning about finances, online shopping has changed how kids experience spending.
“Families are juggling so many more responsibilities today than ever before, so it’s understandably more complicated to find opportunities to teach financial wellness to children or to find hands-on purchasing moments to talk about the value of money,” said Anastasia Morgan-Gans, an executive focused on family financial health at Chase.
Fortunately, new tools are helping meet the changing needs of parents and their children. For example, the free Chase First Banking account is designed to help families develop healthy financial habits by putting parents in control and giving kids and teens the freedom to learn how to earn, spend and save money.
Through the Chase Mobile app, parents can assign chores and provide allowance, set amounts and locations of where kids can spend money using a debit card, and help children reach savings goals. Kids interact with the app on their end, too, checking off assigned chores when completed and seeing when their allowance is paid. They can also see how much they can spend and where, as well as their savings goals.
This type of digital tool makes financial literacy discussions easier and brings family money management into the digital age, engaging kids in meaningful ways. In addition to adopting useful tools, it’s important to have ongoing conversations about finances. Morgan-Gans suggests starting with some rules for a family ‘contract’ when it comes to having access to an account:
• I will spend responsibly and discuss what are acceptable purchases with my parent
• I will make a savings goal, discuss it with my parent, and work toward it
• I will not use my debit card on websites or at stores my parent does not approve of
• I will always keep my card in a safe place and discuss the best place to keep it with my parent
• I will not share my PIN number or account number with anyone
• I will not post pictures of my card or app on social media or share them with my friends
• I will never go to an ATM alone and will only use ATMs inside a bank
“These tools can help guide parents, so they have the confidence to teach kids about bank accounts and spending – it’s like an account with training wheels,” says Morgan-Gans.