Financial literacy for kids is important for a number of reasons. Not only can it help your child avoid debt and excess spending, it will also help them develop healthy financial habits. Children should be taught financial literacy from an early age and be taught to make good financial choices. Here are some tips to help your child build financial literacy:

Financial literacy starts with open communication. It doesn’t have to be a formal conversation; teachable moments can happen every day. For example, a news item about bankruptcy could be a great opportunity to discuss personal debt, or a gas station transaction can lead to a discussion about the cost of gas. The key is to explain how money decisions will help them achieve their goals.

Financial literacy for kids also begins with budgeting. Budgeting will teach your children how to make wise spending and investment decisions, and it will also help them set financial goals. As a parent, it is your responsibility to teach your child to save money. Don’t let stereotypes hold them back from pursuing their dreams.

Once Upon a Dime is a great example of an interactive lesson plan. The lesson plan teaches kids basic economic concepts while providing role-playing opportunities. Another excellent resource is Practical Money Skills, which links parents, educators, banks, and governments to the resources they need. Another example is the Consumer Jungle, a website with financial literacy games and activities.