Good News, Bad News for Financial Literacy Effort

May 1, 2007 (SmartPros) — Some good news has recently emerged about parents, children and the topic of financial literacy. According to a survey commissioned by A.G. Edwards and conducted by Harris Interactive, 63 percent of parents said they have discussed the concepts of saving and investing with their children.

But the bad news is that there are not many action steps following those discussions, as less than half of parents said they helped their child open a savings account (44 percent), and less than one-fifth (18 percent) have required their children to put a portion of their allowance into savings as a means of encouraging their child to build their own nest egg.

“What’s encouraging is how parents are reprioritizing financial literacy in their child’s education,” said Sophie Beckmann, CPA, CFP, personal financial strategist for A. G. Edwards. “We’d like to see parents take a more active role in teaching kids about saving and budgeting. The younger children begin to learn about saving and investing, the better off they’ll be.”

According to the survey, 23 percent of parents believe their children are too young to worry about it, and 14 percent admit not knowing very much about it themselves.