If you thought the easiest way to teach your kids about money was to have them write down their goals and stay on a budget, you’re a genius.
According to a study from Inceptia, a nonprofit that promotes financial education, the two measures that correlated most highly with financial confidence and know-how in college freshmen were writing down financial goals and sticking to a budget.
The study found that students who said they had a budget were likely to feel capable of handling their financial future and of feeling in control of their financial situation. Those with budgets were also more likely to be saving on a regular basis.
Unfortunately, only 51% reported actually having a budget.
Additionally, feeling confident and actually knowing the right moves to make are sometimes two different things. While three-quarters of the freshmen in the study said they felt capable of managing their future income and achieving financial goals, only half or fewer rated themselves as good or excellent at setting a budget, managing credit cards and student loans or understanding investing and compound interest.
Still, the simple act of writing down financial goals seems to make a huge difference. According to the study, 22% of students with no financial goals said they tracked spending, while 44% of kids with financial goals tracked their spending and 68% of kids with written goals were tracking what they spent.
“Everyone from college students to multi-millionaires should have financial goals, and a budget is simply a plan for reaching them,” Kate Trombitas, co-author of the study, told Time Business & Money.