Five Facts for Financial Literacy Month

Parents know how to celebrate Thanksgiving with their kids—they prepare a lot of food and decorate the refrigerator with handprint turkeys. Valentine’s Day is the time for sweet treats and cards for children’s classmates. Costume ideas and trick-or-treating plans are laid before Halloween comes around.

But how do you mark Financial Literacy Month? In 2004, April was given that designation to promote financial education in the U.S., and the month in some years, including 2021, also has been proclaimed National Financial Capability Month.

If you’re not sure how to celebrate, the St. Louis Fed’s Economic Education team has some ideas for you. Your kids will find out about their place in the economy and prepare for handling their personal finances.

How Kids Can Learn about Their Place in the Economy

Let’s start with younger children. Second grade is not too soon to introduce them to economic and personal finance concepts. The Explore Economics Video Series can help you do just that.

In “Consumers and Producers,” for example, kids learn via a video and a catchy tune that when they make a bookmark, they’re producers, and when they use the bookmark in a book, they’re consumers.

Facts about producers and consumers:

• When people make goods and offer services, they are producers.
• When they buy or use the things produced, they are consumers.

Teaching Teens Personal Finance Responsibility

Middle school and high school students might already be handling some aspects of their personal finances and needing to learn about more as they prepare to become more independent.

They can learn about a variety of topics, including the strategies recommended for paying off credit card debt, in the Focus on Finance series of the Page One Economics essays.

And a short video in the Continuing Feducation series explains how a credit score is determined.

Understanding How a FICO Credit Score Is Determined

SOURCE: Continuing Feducation Video Series, "Understanding How a FICO Credit Score Is Determined."

Fact about credit scores: The FICO credit scoring model (named after the Fair Isaac Corp., which developed it) uses these percentages to determine your credit score:

• 35% payment history
• 30% amounts owed relative to credit limits
• 15% length of credit history
• 10% types of credit used
• 10% frequency of new credit

Getting an Overview of Money and Payments

The way we pay for things has changed dramatically over the years. Middle school and high school students can get an overview of payments from bartering to Bitcoin with the Payments 101 teaching module.

Fact about payments: The use of checks declined with the growth of electronic payments, and now the Federal Reserve Bank of Atlanta is the only one of the 12 Federal Reserve banks to process checks.

Tools for Parents and Others

The resources featured here are just a few of the hundreds available at the Economic Education team’s webpages and on the free Econ Lowdown platform. There are more than 600 online learning resources and almost 250 videos you and your kids can access from home.

Fact about resources: Pairing Parent Q&As with popular children’s books can help you open conversations with your children about personal finance and economics concepts.