Most parents may feel that teaching their little ones about money at a young age may not be that important.
However, with the unpredictable fluctuations in the economy, teaching your kids about money and the importance of saving can make a big difference in the long run.
When your children know how to value money and spend it thoughtfully, it can ease up your financial burden since they will understand the relevance of saving and spending wisely and survive in an unstable economy. Here are ways to teach your children about money concept.
Often talk about simple money concepts
If you only discuss money matters by the time that your child is big enough and need his/her own bank account, the topic may overwhelm your kid. Talk about money even before they enter school.
- Use everyday situations to talk to your child about money matters. When you go shopping or buy groceries, give your child the chance to be aware of the price difference of common goods and food items.
- Also explain to your child that money from the ATM machine is earned. It does not come freely from the machine and that everyone has to work to earn money.
- Teach your children to share. Let them understand that money does not have to be used only for their own. Explain to them that it can also be used to help others who are also in need.
- Remember that children learn best through playing. There are lots of games that will let your child learn about the concept of money such as the monopoly game. Also online games regarding monetary concepts are also available.
When they’re ready, give them experiences
Generally, students who are almost done with high school are open to ideas of having a part time job when they enter college. Part time jobs are also effective starts to prepare for a permanent work after college.
- You can also give incentives to your child for a job well. This will help them understand the connection with work and money.
- Encourage them to budget their own allowance. This will enable them to learn the relevance of spending wisely.
- Allow them to allocate a cost for the items they need. You can also encourage them not to spend or buy the item right away. Instead, search for a better item with a better price.
- When a child is mature enough or in their teenage years, you can also start explaining to them about insurance.
On the other hand, while teaching your children about money matters, never be too upset when they don’t take your advice. Remember, experiences are effective teachers and your kid will surely learn from mistakes. Making a wrong buy or exceeding on the allotted budget should teach your child to find a more reliable approach when spending.
However, you can help when they are in debt by teaching them strategies to pay it off and maintain a good credit score.