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In some basic schools in Nigeria, children are being taught Financial Literacy as a subject. This is commendable.
Even at home, some discerning parents and guardians, take it further by opening a savings account for the child or getting the kids piggy banks to save money little by little instead of spending it all on candies and snacks.
Godwin Chukwuma, a businessman said, “Teaching my children about financial literacy started when they were at a young age; getting them excited about responsibility by extending trust and having them learn to evaluate investments with guidance. I engage them in tasks with little payment to encourage them while I teach them the need for responsible saving for the future.
“Encouraging my kids to set short-term goals when they were little helped them learn the value of delayed gratification. As they have gotten older, they are now able to save for longer-term goals. When a kid understands savings, investment, and finance at an early age with a close guardian, building wealth and finance for the future is inevitable, Chukwuma, started.
The business mogul, who stressed that financial education must be given top priority among school children, called on parents to carry their children along with their investment plan for them.
He said, “My son is in the university at present, I didn’t bring out or pool money for his education, investment in his education started a decade ago and today, I don’t struggle with his fees because the financial investment in his education has paid off. This is made possible due to my financial investment understanding and I affirmed that parents should educate their wards in respect to that. My son understands the investment plan and lives within his means; prioritizing financial decision-making. Educating the children on financial literacy is therefore germane and sacrosanct.”
Asked at what age children should begin learning good financial habits, he said that some families “subscribe to a school of thought that once children start counting, it is the beginning of financial literacy. It is never too early to begin the journey of good financial habits that include knowledge, skills, and dispositions toward a strong and healthy financial report card.”
Parents, he goes on to say, are a child’s first teachers, and it’s not unusual that financial literacy should begin at home, too.
For Mrs Omolara Ogunbiyi, financial literacy is important to establishing a foundation of success, noting that “We can plan for future goals and outline the steps to take in achieving them, as well as obtaining knowledge to plan for unforeseen circumstances."
Ogechi Chukuwuka, an undergraduate student of Delta State University, Abraka said financial literacy education had helped me to financially prioritise and manage her money effectively.
According to her, “I started to learn the importance of finance in secondary school as a fiercely independent person. I was 15 when I first started working part-time. I was careful in watching my savings grow and used that to gauge what was required to venture out on my own having come from modest means.
“I started in an industry at 18 before I gained admission and my financial planning became a part of my everyday habits, and at times sacrifice, when prioritizing to manage my money effectively.”
Speaking on the best advice she had received, Chukwuka said, “individual should live within their means and prioritize their financial decision-making to manage finance and budgets effectively.
Children and adolescents can only realize their full potential as citizens if they are financially empowered and capable; the building blocks in this respect are financial education and financial inclusion.
According to the Organisation for Economic Co-operation and Development(OECD), “financial literacy: knowledge and understanding of financial concepts and risks, and the skills, motivation and confidence to apply such knowledge and understanding to make effective decisions across a range of financial contexts, to improve the financial well-being of individuals and society, and to enable participation in economic life is pertinent to be taught in schools and across the continent for children to exhibit prudence in spending.
Financial literacy refers to ways in which individuals understand, manage, and plan their finances. The core of the domain of financial literacy is personal finances that can support financial well-being: a situation in which personal finances are a means to achieve and maintain a desired standard of living.
Every parent wants the best for their children. This doesn’t necessarily mean you want them to have the best clothes, the latest toys or the coolest gadgets. Most likely, it means you want them to be safe and secure. And you want to lay a foundation that they can build upon to do well in life. The question, then, is whether you’re teaching your children a key lesson that will impact their lives significantly. That lesson is about money.
“Without a working knowledge of money, it is extraordinarily difficult to do well in life,” says Akinyemi Kunle, a banker. “Money is central to transacting life, day in and day out. Where we live, what we eat, the clothes we wear, the car we drive, health care, education, child-rearing, gift giving, vacations, entertainment, heat, air-conditioning, insurance—you name it, money is involved.” Yet, plenty of parents aren’t helping their kids become financially literate.
Parents should not miss the opportunity to talk to their kids about money and finance. Even if you’re not teaching your kids, they will learn lessons about money one way or another. If you want to play a key role in shaping your children’s feelings, thinking and values about money, you need to give them the gift of financial literacy from an early age. Here’s how.
Lessons should begin before age seven, Mr Kunle said, because research shows that money habits and attitudes are already formed by then. “Once your kids are old enough to know they shouldn’t be sticking pennies in their mouths, you should introduce them to coins and cash.
Parents should educate the kids on how money works and its effects, and teach them the essentials of savings, “Saving teaches discipline and delayed gratification. Saving teaches goal-setting and planning. Saving stresses being prepared. Saving builds security and independence. Saving money is a great habit. But if you want your kids to learn how to truly build wealth, teach them about investing,” Kunle says.
If you want your children to develop good spending and saving habits, they need to see you making smart spending and saving choices. In short, practice what you preach. And preach with consistency. Educating your children about personal finance is a process that can take time. But if you put in the effort and continuously communicate a clear message about money, you will instil good habits that will serve your children well.
