Everyone once wondered why some people have financial independence while others work to survive. This seemingly complicated question has a straightforward answer. As a rule, people do not have financial literacy and do not know how to manage money.

In his book “Rich Dad Poor Dad,” Robert Kiyosaki wrote that people live in the so-called “rat race.” He describes it as follows: a person grows, receives a good education, marries, and has children. Family incomes are growing, and people acquire welfare symbols – home, cars, and rest abroad. Needs, like income and taxes, are growing all the time. People start looking for a part-time or a second job, it’s time to start saving up for college, save money on vacation, pay loans for a new home or car, and there’s not enough money for anythingAnd then the time comes when it is time to save money on old age, and so in this way, people get caught in the endless “rat race,” where is neither finish nor victory, just as the snowball grows expenses that income doesn’t have time for and there is no accumulation as it was not.

I provide paper writing help and have written numerous articles on the topic of financial literacy. For this purpose, I have researched this subject. And so I can say with certainty that a person mostly spends his earnings on liabilities (assets that lose their value over time and do not bring money) while forgetting about assets (assets that bring additional income). It is necessary to teach financial literacy from childhood, to lay its foundations in childhood.

You can solve the problem of financial illiteracy of people by introducing the subject into the school curriculum. Some countries fund financial literacy education for children. For example, the United Kingdom introduced a school subject in business education, where they taught children how to manage money.

In the Czech Republic, there is also the subject of financial literacy, where children have explained what money is, how to distribute, control, and regulate personal income and expenses. Students receive information on taxes, utility bills, fees on food and clothing, capital expenditures on the purchase of housing and a car, and the accumulation, investment, and opening of their own business.

In the US, the Treasury Department has launched the Money as you grow the educational project. There are five sections on the website with information for different age groups: 3-5 years, 6-10 years, 11-13 years, 14-18 years, and 18+ years. The data, methods, tools, developmental games, and tests collected here are recommended for teachers and parents to teach how to handle money properly. To better understand the financial system as a whole, children in school need to write an essay on the subject of finals. Formulating their point of view on this issue, they will be able to understand complex financial transactions. For this, children also need to study a large amount of information independently and read a lot of information about finance. Many sites have significant essays database on financial topics.

In this article, I want to highlight several basic concepts that children need to know:

1) We get money for labor. 

Children do not see how their parents work, but they understand that a particular machine (ATM) gives out money if you insert a magic card there. And you can also attach this magic card to the terminal in the store – and you will buy everything you want. The real reason why money is issued and products paid, they do not know. Therefore, they need to clarify that all this is happening because mom and dad are working.

2) Money needs to be counted. 

It is essential to teach the child how to manage his budget (when the pocket money period begins). The child needs to be told about cash flows, where the money came from, and where it went. If you understand this information, you can more consciously approach your money.

3) You can save money. 

Everyone has dreams. Children are not as global as adults, but nonetheless. Many parents buy their children everything they want (because the parents themselves had a difficult childhood). As a result, the child does not know what he wants, drowns in gifts, and believes that everything comes to him very quickly. Therefore, it is important not to ridicule children, leave them room for desires, and learn to save for their implementation.

4) Money can be put under interest or borrowed.

Yes, this also needs to be taught to the child in the family. Let mom and dad act as a bank. You can offer the child the money for storage to adults at a percentage (as a deposit in the bank). Or if the child lacks something but wants to offer to lend at interest. This way, children will study deposit and credit relations well.

These are the main points that you can start teaching a child from preschool and primary school age.

The older the child and closer to independent life, the deeper the necessity to develop monetary and economic relations. It’ll be essential to study the topic of insurance, investment, retirement savings, the basics of the tax system, and so on with your child. And, most importantly, financial security. Of course, the most important and the best way to teach a child is a personal example of parents. But if some topics in adults “sink,” you can use courses, training, and game technologies that will help the child develop each question thoroughly.


Esther Crowder is an enthusiastic blogger and editor. To improve his writing skills, he writes articles on various topics. He writes articles on such topics as business, education, computer science, etc.