Children absorb information readily, teaching them about money from a young age can be of great benefit and be a lot easier than you may think.
Understanding money skills like saving, earning, spending, and investing will make them better money managers who know how to budget. If kids realize the value of money when they are children, they will be able to make better financial decisions as they move to adulthood.
Let’s look at ways we can teach our children how to manage finances and get a head start in life.
Encourage them to save coins in transparent piggy banks. This way, they can see their pile of money grow.
2. Be a good example
Explain to your children what is happening to your money when you use your credit card to pay or when you use an ATM. Use cash and show them what you were able to purchase with a limited amount of money.
3. Chores for money
Encourage tasks to be done around the house that get rewarded with an allowance. This way, they will see they have to work to earn. Give a fair pay for bigger jobs like mowing the lawn or washing the car.
4. Open an account
Explain to them how, when saving money in a bank account, it grows with interest.
5. Encourage giving
A good habit to form from a young age is to give. Your children will grow to be generous members of society.
6. Teach them to be entrepreneurs
Give them the chance to make their own money by starting their own business. It’s one of the best ways to practically learn how to handle money.
7. The act of budgeting
Get your teen into the habit of budgeting their income. There are many simple apps available to keep it attainable.
8. Danger of debt
Advise your children on the risk of credit purchases. Debt is not a sound footing in which to start adulthood.
9. Don’t impulse buy
Teenagers are very quick to capitalize on the impulse buy, especially if it’s not their money. Let them know they can use their own money to make the purchase but encourage them to wait a day and make a decision with a level head.
10. Be content
Teach your children to be satisfied with what they have. Contentment starts in the heart, and as adults, we must let our children know that what they have right now is sufficient for their purpose and does not need to be compared to others.
Take the time now to help your children learn the importance of money management, giving them the edge to a successful adult financial life.