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The proper handling of money and banking is one of the most important tools you’ll pass on to your kids. Knowing how to spend and save money will help children become successful adults. The financial professionals at Putnam 1st Mercantile Bank in Cookeville, TN, share a few banking lessons parents should teach their children below. 

What Your Child Should Learn About Banking & Money

1. Credit Cards

Your adult child who is either in college or starting their first job might be itching to get a credit card since it allows them to buy now and pay later. However, relying too much on a credit card quickly puts you in debt, which negatively impacts credit history and the ability to buy a vehicle or a home. If your child wants a credit card, they should know it’s only a smart decision if they pay the balance completely every month.

2. Income & Taxes

bankingBefore your child starts their first job, they should learn about the amount their income will be taxed. It’s crucial when budgeting for monthly bills and staying out of debt. If your child is younger and earns an allowance, instill this lesson by taking a portion out of each allowance payment. Your child will become accustomed to accounting for such deductions and will plan better financially once he or she is older.

3. Online Banking & Bookkeeping

At a young age, a child sees money as green bills and shiny coins. As they get older, make sure they become familiar with other forms like online banking accounts, checks, and checkbook registers. If your child earns an allowance, have them record the income and anything they purchase with it by using a checkbook register. They’ll learn their balance on paper and understand how to write a check. Open a checking account online to show them how to keep track of their debits and credits there. 

Whether you’re looking for a reliable bank to provide account options, loan assistance services, or financial advice, call Putnam 1st Mercantile Bank at (931) 528-6372. The families of Cookeville, TN, consider it the best banking service in the area due to their fair rates and outstanding customer service. Visit their website to learn more.

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