Why Is It Essential For Parents To Encourage Kids To Start Banking From A Young Age?

Why Is It Essential For Parents To Encourage Kids To Start Banking From A Young Age?

Saving money will always remain one of the essential life skills that every individual must master over time. Of course, money might not be the defining factor for leading a happy life, but it is indeed a crucial part of our daily life. And the most significant challenge about saving money is always faced by people who are entirely clueless about handling finances and investments.

According to a 2021 survey, 54 percent of American adults live by paying only their paychecks and having little to no money saved for their future. How does that sound? It might seem to be an unrealistic theory, but unfortunately, this is just the peak of a critical problem that resides in society worldwide. 

Whether it is the USA or India, parents aren’t pretty sure about teaching their kids about handling money from an early age. Instead, they are keener on teaching them about their careers and academics but not giving them financial literacy. 

Learn More About Financial Literacy

The reason behind such a mindset might be the traditional thinking of focusing only on one’s career and not any other skills. But the way the entire world and especially the fintech industry is progressing, children need to start learning about saving money as early as possible. 

Are you still clueless about teaching finances and investments to your kids? If you are more focused on your child’s career, take a moment to think about the effect of financial literacy. Unfortunately, financial literacy is often skipped in the case of children as the conventional education system’s curriculum does not pay appropriate attention to it.

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But given the advancement of technology and science, people are becoming more aware of the importance of finances and teaching more about investments and savings to their kids from an early age. 

It is practically impossible to master the skill of money management if the individual doesn’t have appropriate exposure to such practices. If you’re still on the fence about handing financial freedom to your children, here are five strong reasons to do it right now:

One of the best ways to teach your kids more about money and investments is to switch from a traditional bank to a NEO bank for teenagers. NEO banks are digital banks that are practically available for all, irrespective of any parameters. Therefore, one can easily open an account with a leading NEO bank and enjoy seamless banking services without any hefty expenses. 

Sound & Secured Financial Future

You are concerned and always on your toes about teaching your kids the basic life skills and important ways to make a promising career in their life, and rightly so But then why leave out helping them with the basics of finances? 

If you want your child to have a secure future, you should start teaching him about financial investments and savings as soon as feasible. The more they know about handling money, the better they will get at savings and investments when they already have a secured career ahead. And the best part of it, you never again have to worry about his decisions.

Accurate Information About Money

You, as a parent, are responsible for shaping your kids’ future. That is why teaching them every skill is essential. But if you do not start teaching him about finances and investments and leave the job merely to the internet, they stand a chance of being misled by the overflowing online information. 

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In addition, not everything available digitally is appropriate for your kid, especially when he is learning these concepts for the first time. So, ensure that you yourself initiate providing him with accurate information about finances and investments and help him develop strong money management skills with time.

Responsible For Distinguishing Needs & Desires

The most significant challenge people face in their lives is to strike the perfect balance between their needs and desires. Not everything that you desire is ideal for your life. Not everything you see online or in your friends’ houses is suitable for you. 

Even though these concepts are pretty clear to people, they can seldom achieve this balance in life. But teaching your kids about money and helping them distinguish between their needs and wants can definitely help them develop this good habit. 

Older teens can get accustomed to managing their savings and expenses if introduced to such practices early. And the best thing about savings with digital banks is that they reward you every time you save a part of your funds and mange your money better. 

Money Independence Matter

You want your child to be a successful independent person. And independence is only truly achieved when there is financial independence. . So understanding how teaching them about finances from an early age can help them be well aware of their funds, savings, and investments can ultimately teach them the value of money. 

For example, suppose you let them pay for their expenses as early as possible and let them save their money for future endeavours. In that case, it will help to inculcate a feeling of responsibility and independence simultaneously.

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Avoiding Debt

EMIs is a big concept in the market that can positively and negatively affect life. Sometimes people end up paying loads of EMI without any savings for their future. You never want such hassles in your child’s life. 

That is why introduce your kid to the best baking apps for teens, that instil financial literacy and help them go the extra mile Well, letting them pay and save simultaneously will help them understand the value of money and manage it significantly.

Moreover, it will help them understand how to avoid being in debt. If they fail to understand, you can always team up with them to help them out. So, keep a tab on their investments and expenses. Feel free to do so if you feel it needs to be controlled,  although always have clear communication regarding the same with your kid first.

Spotting A Scam Gets Easier

Teenagers are constantly using the digital platform. So, they are always prone to cybercriminals who target children to get access to their funds. But if you start helping them learn about these financial scams, it helps them understand the importance of passwords and encrypted platforms. 

With time, they get used to creating strong profile passwords and information while identifying suspicious links that can ultimately lead to financial fraud. 

Let your teenagers ask you all the possible questions about making a purchase online and financial investments. Let them understand how to compare prices and identify scams while making healthier decisions about their money. 

Bottom Line

The earlier you start teaching your kids about banking and finances, the better it gets for them to protect themselves from financial stress. Let them make mistakes today so that they never have to worry about their investments in the future. 

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