Parents often tell their kids that if they study hard, attend college and get a job, they will have a decent life. Yet, there is usually more than just earning enough to make ends meet.
It is a good start if you begin your financial planning with a budget. However, you may soon discover that sustaining a long-term budget with your financial goals intact is quite a huge project in itself.
Additionally, people tend to learn from what they are exposed to and businesses are quickly leveraging on this opportunity with fanciful financial products to lure young adults.
Bear in mind however, that the responsibility of financial well-being is up to the individual as businesses place more emphasis on selling rather than educating.
So how do you decide based on your individual circumstances?
In this case, you need financial knowledge and good habits to make sound judgement calls and leverage the best financial products.
Fear of money talk at home
Some parents worry that full disclosure of their family’s financial state can add more stress to their children’s lives. This is especially true for families who are struggling with poor financial planning.
Others argue that children should have their “childhoods” and financial literacy forces their children out of this precious phase.
Additionally, some parents feel that they are not well equipped with the right knowledge to handle money efficiently. This is unfortunate as most parents do know some form of financial literacy.
Lessons from failures can be just as important as successful methods towards building a financially sustainable household. Parents can share their tried-and-tested strategies as part of the learning process for their children.
Lack of demand for financial literacy courses
On the other hand, schools are struggling to teach financial literacy across the world.
In this region, exam-based subjects are the usual priorities over critical life skills such as financial literacy.
Furthermore, financial literacy education is often bundled with risky stock-investing classes or insurance pitches, making many educators frustrated.
The effects of such classes are often negligible as the importance of money habits is lost to the mentality of getting rich quickly.
This deters sceptic educators from supplying more funds for financial literacy programmes in school.
Start young, start right
Personal finance is nothing new. Global events such as the US subprime mortgage crisis of 2008 to recession survival in Asia have taught people how to be more careful about how they budget their finances.
Yet, many tend to neglect the knowledge they learn about finance and money habits over time.
Parents cannot prevent their children from talking to their peers or picking up online knowledge about personal finance. Therefore, parents should guide their children on how to research for accurate finance knowledge and understand the options they have.
It is recommended that parents start this teaching process early so that they can help their children create a set of financial values that they can abide by throughout their lives.
Good money habits can also contribute towards a good game plan for them to succeed financially in life.
Any parent wants their children to have brighter financial prospects and a more secure future. Moreover, it would better if children can grow up to become financially astute adults.
Therefore, it is highly recommended that parents include the discussion of financial literacy with their children as early as possible.
This article first appeared in The New Savvy.
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