How To Educate Your Children About Finances
I'm Dr. Tammira Lucas, better known as The Business Dr. I'm a wife, mom, and serial entrepreneur whose focus is on helping families create generational wealth through business ownership.
In the black community, we often lack the knowledge and resources needed to understand what generational wealth is and how to execute a plan to start building generational wealth. Wealth is not taught to children in school, and often there's no one around them to educate them. Please understand that you are NEVER too young to learn about wealth, finances, or business. Children are sponges; they soak everything up and retain the information; therefore, educating them at a young age is beneficial. Here are my top three tips to help expose your child to wealth-building habits and ownership.
Start with the mindset.
Wealth starts with the mindset. If you think broke, you'll be broke. Instead of thinking and teaching your children about name-brand items, teach them how to own a part of that brand. Before you change the mindset of your children, you have to start with your mindset. What is your perspective and relationship with wealth and money? Do you understand what ownership means? Shift the thinking for the entire family. Once I changed my mindset about money, I effectively instilled values and a wealth mindset in my child.
Ask yourself, "How can I own this?"
Before I purchase anything that my 10-year old daughter Ryann asks for, I make her provide me an overview of the company and check to see if the company is a public company that she can own stock in. If the company is not public, we evaluate its longevity and how we can get a return on our investment. Material things will depreciate faster than the stock for the company. Think long-term with your purchases.
Open a bank account for your child.
Whether your child earns money doing chores or helping you to manage your business, consider opening a bank account for them to store, control, and protect their finances adequately. Have them look over their transactions (deposits and withdrawals) and teach them how the banking system works. You can open a bank account with CapWay and use their financial literacy program, Phunds, as an educational resource to help your child learn more about money.
Teach your children about money early on so that you can help them learn to have a good relationship with money and understand ownership. It's nearly impossible to own assets if you have bad money habits.
Remember, exposure is key so expose your child to finances early!