MOLLY CATALDO: Developing money management skills

Parents spend countless hours teaching their children. Whether it’s how to tie their shoes, ride a bike, or learning to read, parents are essential for a child’s cognitive growth. Unfortunately, one area of learning that is often overlooked by parents is teaching their children how to manage money.

Whether it’s because their own parents didn’t teach them, they’re uncertain how to teach money management or they simply feel it’s a private matter, parents often forget to provide even the basics in money management.

With this being said, here are a few ways you can teach your children, teens and young adults in your life healthy money habits:

Lessons for young children – First and foremost, parents should be involving their children during their activities or errands where quick impromptu money lessons can be taught such as at the supermarket or bank. One of the best ways to teach children budgeting and spending is to give your children a weekly allowance. Talk with your children about the importance of saving a portion of their allowance and help them decipher between needs and wants. A good way to encourage saving is to give children an incentive. For example, for every twenty dollars your child saves, contribute five dollars towards their savings account.

Lessons for teens – Retailers are very good at marketing to teens as they know this age group often has disposable income. It’s up to the parents to teach them the difference between needs and wants. Letting your teen have a prepaid credit card is a good way to introduce them to the world of credit. Since you’re introducing your teen to credit, it’s important to talk with them about the importance of having a good credit score and how at times, credit cards can hurt your score. Providing these lessons early will help them when they leave the nest for college or enter the workforce.

Lessons for young adults – Prior to your young adult moving out of your home, teach them how to create a working budget. Sit down with them and talk about monthly living expenses.  Based on this conversation, your young adult will be able to clearly see how much they will have left each week or month to save or spend on other items. If you haven’t already done so, help your young adult establish a checking account. Teach them the importance of consistently monitoring and recording what is spent from the checking account. Finally, talk about credit reports and help them order their first one. When it arrives, sit down with them and explain how to review it.

Remember, the more time you invest in teaching your children about money, the more likely your child is going to be good at saving and choosing what items to spend their money on. The benefit is, they’ll hopefully establish good money management skills which means they’ll come to you less to borrow money. Your child will also be able to pass along valuable lessons you’ve taught them to their own children.

About Citizens Bank: Citizens Bank is a diversified financial services company providing a wide range of commercial, consumer, mortgage, trust and financial planning services to a broad client base. For more information about Citizens Bank, visit

Molly Cataldo, Branch Manager, Assistant Vice President, Citizens Bank of Evart.