Financial literacy is the ability to understand finance.  By definition it is an individual's ability to make informed judgments and effective decisions about the use and management of their money.  National Financial Literacy Month is recognized in the United States in April to highlight the importance of financial literacy and teach Americans how to establish and maintain healthy financial habits.  In 2000, the Jumpstart Coalition for Personal Financial Literacy began promoting April as Financial Literacy for Youth Month and in 2003 the United States Congress showed its support.

Many of the country’s financial institutions and nonprofit financial educational organizations promote Financial Literacy by holding promotional events and creating educational materials that center around effectively handling money and dealing with consumer debt.

Most of these financial companies can assist consumers with Financial Literacy in an array of courses on budgeting, using credit wisely, and savings strategies for credit cards.  Upon course completion of the Financial Literacy Program, the names of participants are submitted to the American Center for Credit Education to be included in a national database accessed by creditors and lenders.

The root problem and cause of many financially challenged and “debt heavy” individuals usually stems from the abuse of credit.  The ability of many American families to live beyond their means can create an out of control debt situation requiring special assistance from creditors.  These programs are available through reputable credit counseling companies and should be evaluated before last resorts like filing bankruptcy. Through education and the responsible use of credit – USING FINANCIAL LITERACY – unmanageable debt can be avoided.

In order to avoid falling into an unmanageable debt situation it is VITAL to educate young people on Financial Literacy, from small children, through adolescence and into adulthood.  There are several ways to begin educating your children in becoming financially fit for the future.

The Jumpstart Coalition for Personal Financial Literacy determined that the average student who graduates from high school lacks basic skills in the management of personal financial affairs.  Many are unable to balance a checkbook and most simply have no insight into the basic survival principles involved with earning, spending, saving and investing.  What can you do with your kids to assist them in becoming financially fit?

Ways your kids can earn some money
Typically, children and adolescents like to go shopping, watch movies, play video games, listen to music and go out to eat with friends.  To do a lot of things we love, we almost always need money.  Here are 7 ways your kids can earn some money for themselves:

1. Help out more at home.
   They can assist with cleaning the house, taking out the garbage, doing the dishes and keeping their room clean.  If they do these things they can earn an allowance if these assigned chores are completed.
2. Help people take care of their yards.
   Asking neighbors if they need their lawns mowed and charge a fair rate for this service.
3. Wash cars.
   Once a month have a car wash.  Invite friends over and host an all day event.
4. Sell unwanted items.
   Have your kids go into their rooms and take out anything they do not want and they can have a garage sale and sell those items to make some money.
5. Bake sale or lemonade stand.
   Have your kids bake some cookies or make some lemonade and sell to your neighborhood.

Some savings techniques to educate your children:

• Set up some “Piggy Banks” or jars that your kids can deposit an allowance or money they earn, so they can purchase items on their own.
• Set goals on savings.  If you kids want a video game they will need to save up for it.
• Be a smart shopper.  Teach your children to shop smart.  If they want an item make sure they are getting it for the lowest price they possibly can and teach them how to do that.

As your children become teenagers, earning money at a job is their first step towards being on their own.  Whether it’s an odd job for neighbors or part-time employment, they can use that money to reach their goals.

• The 10-Hour Technique – The National Institute for Work and Learning in Washington, D.C., recommends that teens should work only 10 hours a week, with most of those hours falling on the weekend.
• Working in the summertime is the “right time” –During the summer, they can jump head-first into a job without worrying about skipping schoolwork.

In the end, we hope that our children will grow into financially responsible adults.  The rewards are life-altering; living within their means, free from the anxieties of debt, and secure in their future.