Financial Literacy

Financial Literacy is meant to be an education on financial planning and management. This is equally important like graduation.

Why we plan to make our children a graduate. To get a job right. The ultimate result is income (Finance).

The total humanity is in need of income, for which education became investments nowadays. Hence, financial education is as important to handle and leverage.



·       We must have seen many families, where their father works hard to make his generation to be upper middle class or rich.

·       Only a few families tend to continue the legacy of being rich.

·       Others spend all the investment and savings that were collected by their ancestors.

·       This is only because of the failure of the parents on not educating them on our financial planning or management.

·       Let us now dive into the course of how we can educate our children with few stages depending on the age group.

1.    Stage I – Early Childhood (Age 4 – Age 8)

2.    Stage II – Middle Childhood (Age 8 – Age 12)

3.    Stage III – Adolescence (Age 12 – Age 18)

4.    Stage IV – Adults (Age 18 – Age 25)

·       Let us see what all to be done in the course of teaching with these stages.



·       This stage is more important, as their brain development and habits develop. As parents, we have to show them good habits.

·       Children will just copy what we do. When we get up early in the morning and take a book. Our child will be doing the same in the future.

·       If we go towards television or social media, so our children to do the same.

·       During this period, make our children save money in a penny bank, or child bank account. So, they don’t withdraw their savings.

·       Provide them some money at the beginning of every week and make them cultivate a habit of savings. This will make our children the awareness and benefits of savings.

·       Make our children think about saving more than on spending. These habits cannot be seen in our children until we have those habits.



·       This stage is the second stepping zone. This gives the second chance for the parents who missed to teach their children on financial literacy.

·       In this age group, children closely watch us. Our habits and our activities will be seen in our childhood development.

·       Educate our children on how to generate income. Job is not the only way for income

·       Teach them highly on how to generate passive incomes, and leading their focus towards.

·       Teach them on investing, not just savings. Lessons on savings should be quit as stage I ends. This stage should know the various ways of investing.

·       Don’t teach them only on the traditional way of savings like bank savings, RD, FD, LIC policies, etc.

·       They should have an initial idea on investment, interest rate, the benefit of long term investment.

·       In this age group, they have to in the mindset of investors.



·       The most and important stage of everyone’s life.

·       At this age, there are much-proven track record of people who started investing. Few people even earn $660,000 per year.

·       At this age period, they should have entered into the equity market. It may be an index fund, ETF, or direct stocks. They will be having a long runway.

·       Teach them on the power of compounding. We will suggest a book on “The Compounding Effect” by Darren Hardy.

·       Also, at this age they should have a DEMAT account, and as a parent don’t provide birthday gifts. Buy some stocks for them.

·       Another better way of teaching financial literacy to children is, provide them the annual school fees at the start of the academic year.

·      Let them manage the money by paying fees and keeping the other amount in the bank. We can provide some interest rates for our children as a bonus at the end of the year for the amount they have as balance.

·       This will reduce their instant gratification and increase their interest over investments.

·       Make them away from television and advertisement, this will make them an investor-minded human in the future.

·       Teach them on “Delayed Gratification”. Teach them on “Needs, Wants and Savings”



·       As a parent, when we have made a strong foundation over the previous three stages. This will be a relaxing stage.

·       Our children will have as equal knowledge as we are. They will be having a practical experience too in investing.

·       They will be good at pick a company to invest in seeing the company’s business model.

·       Never pressurize our children for a job, create them the platform to make passive income. But, they have to start from starch, not getting initial interest from us.

·       Teach and guide them on how to invest in books, investing in developing their skills.

·       Educate them on asset allocation and portfolio management.

·       Guide them on writing their own book, e-books, blogging, etc.


When we guide our children with proper financial literacy, we can be damn assured, they will also teach their children. This results in our generation on a safer side. To educate them, we should know everything about financial literacy.



·       Follow these guidance of all four stages. Deploy in our children’s life.

·       Perfect education on financial literacy will make our generation to be rich.

·       Please comment on your child’s age. Have you started the lessons on financial management with your children?


At this time, I would like to thank my mother (A. Maria Jeya), who taught me the value of 1 rupee. The reason behind my financial literacy.


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