How to teach your children the value of money (and how to manage it)

By Odysseas Papadimitriou

for the Deseret News

Published: Thursday, Sept. 6 2012 10:07 a.m. MDT

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Summary

Despite the financial difficulties of the past few years, parents are more willing to discuss things like sex, drugs and alcohol with their kids than money.

Graduate to a student credit card: You might assume this to be a recipe for disaster given the proclivity U.S. consumers have shown to rack up credit card debt, but the truth is that it’s not hard to avoid debt when credit isn’t available to you, as is the case when using a checking account or prepaid card. And because your child will inevitably be exposed to credit, it makes sense to teach him how to resist the temptation of getting into any sort of debt. Having an open credit card account is also the most efficient way to build a solid credit score, which of course impacts one’s mortgage rate, job prospects, and ability to rent an apartment or lease a car.

Ultimately, it’s a parent’s job to prepare his or her child for independence and groom children to be productive members of society. If financial literacy continues to be an afterthought, not only will we be shirking our responsibilities, but we’ll also be setting future generations up to repeat our mistakes rather than learn from them and go on to bigger and better things.

Odysseas Papadimitriou is the CEO of the credit card comparison website Card Hub and Wallet Hub, a personal finance social network where you can review financial professionals and companies.

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