How to raise a financially literate child

All parents start with an inextricable desire to raise a child who is more successful than the parent. Regardless of how much fun that parent had growing up, he or she wants the child to have an easier road than the one the parent walked. This aspiration is as eternal as time itself. It transcends religion, race, culture and nationality.

Parents around the world love their children as much as parents anywhere. Just don’t say that to the children of African parents; we believe that our parents are the most loving parents in the world. That mindset is largely based on the fact that our parents overcame a lot to raise us. However, history teaches us that some (if not most) of the difficulties that people experience in life are self-inflicted or inflicted by society. Woes come in the form of corruption, civil war, having more mouths than one can feed, broken homes, bigotry, greed, poor health, and bad financial habits. There are things one can do to improve these problems and achieve successful individual results. One of the keys to a better result is practicing good financial habits. It’s not just about knowing what to do, it’s also about putting what you know into practice.

Even in this Eden where we reside with modern conveniences like 24-hour supermarkets and ATMs, internal refrigeration, a social safety net, reliable electricity, and affordable healthcare, many of us in the diaspora have realized the thrill inherent of being parents. We are awakening to the truth of Alayi’s adage that all paths to Arochukwu are fraught with challenges; that the Hot Chocolates didn’t mean it when they sang that “heaven is in the backseat of my Cadillac.” In my humble opinion, people don’t begin to truly appreciate their parents until they become parents themselves, even under the best of circumstances. Any way you look at it, raising a family is a monumental, albeit rewarding, financial endeavor.

Part of being a better parent is teaching our children the skills they need to live successful lives. In this global village we now live in, it is paramount to learn and practice solid financial life lessons. If a child wants to financially endow herself, she needs to learn the positive habits of the rich. Those who ignore these facts of life often pay a heavy price. Yet studies show that parents would rather blabber about birds and bees than teach their children money lessons. It doesn’t help when some parents misinterpret the biblical quote that “the love of money is the root of all evil” to mean that money is the root of all evil. Some say that the “lack” of money is the root of all evil. If a contented person has some reservations, she will be less inclined to do anything for money. On the other hand, a starving and desperate saint would sin in no time for that steaming mush.

A friend, Raymond Matthews, said it best when he said: “Often in life, what money cannot buy, the individual does not need.” That may sound harsh or extreme, but if you think about it rationally, it makes sense. According to an anti-poverty YouTube video, “At the beginning of the 21st century, 1.2 billion people live in abject poverty. More than 800 million people go to bed hungry and 50,000 people die every day from poverty-related causes.” Na Shakara (lack of money) is dat o, paraphrasing the Great One Fela.

Every child must acquire basic financial skills before entering high school. In these times of unemployment, excessive student debt, and credit cards, your child is likely to come home and cause you a lot of trouble later if you don’t arm them with these lifelong skills. One of my cycling friends once told me that the best thing any parent can do for a child is to help them become financially independent as soon as possible. Having a well-paid job is no longer enough; your child should know how to manage his resources. According to Jim Rohn, “If you work hard at your job, you can earn a living [live paycheck to paycheck]. If you work hard on yourself [by acquiring prudent financial skills]you can make a fortune” and have true financial freedom. What matters is not how much you earn, but how much you save.

As parents, we need to be careful about sending mixed financial messages to our children. Parents should not slander the importance of money. Desperate people do desperate things. Some pass up opportunities and, in desperation, encourage their children to rack up huge student loans or play dangerous sports to finance their college education. What seemed like a good way to “beat the system” today may haunt them and their children for years to come. Ask some retired athletes or former high earners. Google my article: “Should you as a parent encourage your child to play dangerous sports.” I put it all there.

Start early! “One important thing to remember about kids and financial education is that it’s more helpful to start teaching kids about money early on rather than waiting until high school,” according to Sara Berthiaum. It is amazing what the human mind can absorb when it is open and eager to learn as children’s minds are. That’s why they learn languages ​​and new things faster than most adults.

I credit my parents, particularly my father Lawrence Okoronkwo Ukaoma, for teaching me the virtues of saving money from an early age. One particular teachable moment is burned into my mind. He was around 8 years old and the brutal civil war between Nigeria and Biafra was in full swing. I had done household chores for a neighbor and was paid in unwrinkled Biafra bills. Thinking that he had made me rich, I went to my father and asked him to keep the money for me. He asked me why he couldn’t keep my money. I replied that I did not want to be tempted to spend it or lose it. He told me that “it was okay to be tempted, but I should learn to control my money because how I manage my resources will determine my height in life.”

My father also taught me about savings accounts, stocks (shares), and real estate investments. He made sure he learned that how much you save counts more than how much you earn. When he was a teenager, he had an account at the then Federal Savings Bank where one could “open an account with just ten kobo.” The reader of that time may remember that jingle. The bank was ingeniously operated through the post offices. During my teenage years, my father would send me to collect rent from his tenants and deposit the funds (and coupons/dividends) into his bank account ASAP to earn interest. He taught me to take off my “going out” clothes and put on my “stay at home” clothes as soon as I got home so my good clothes would last longer. He taught me how “a stitch in time saves nine” and how to defer gratification. If it could be done during and soon after a civil war, it can be done today. Say what you can about Nigeria, I am very grateful for my Nigerian heritage. Most of what sustains me and other people like me today we learned in Nigeria. I learned good work habits, independent thinking and content living from my upbringing in Nigeria.

Developing money-saving habits should not be misconstrued as self-deprivation. Rather, saving money is a way of building a nest egg for you (not someone else) to use when you really need it. It is something that everyone should aspire to achieve. Money may not be everything; nothing is. No one should diminish its importance. Like good health, many people may not realize its essence until they have it and need it.

Who says strong financial skills aren’t important in life? Studies show that financial problems are at the center of most marital disagreements. These problems are exacerbated when warring parents use money as ammunition in battles for their children. Financial education is the initial and lasting casualty in that dead-end war.

Some financial institutions now have a savings account with no minimum. Take your toddler to a financial institution and open a savings account for him or her. Start by doing some research online or over the phone to find out the incentive for new accounts. Some banks will give you $25 to $250 to open an account for your child. Many financial institutions online as well as physical want to have a lifelong financial relationship with young people. Let these banks pay to win your son’s business.

The decision of how much to give your child as allowance, if any, is yours as the parent. Some give money to their children for household chores, such as cleaning their room, the bathroom, or doing the dishes, etc. Others give concessions for no reason. Personally, I give an allowance for chores beyond what my kids should be doing as family members. And I would make sure that the money is deposited into the child’s account to “cool off” and earn interest for a while before spending it. And if the child needs to spend some money, she should do her research before buying.

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