How to teach children about money

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Image credits: http://farnoosh.tv/

Hello everyone, this is my first blog post here, hope you enjoy it an please forgive me if something isn't good.

As a mother fo two children, one of my concerns with their education is to teach them how to deal with money. I want them to have a healthy relationship with money all their lives.  Many adults end up having financial problems because they don't know how to deal with it, spending it in an unreasonable way and nothing sustainable. To avoid these situations in the future and to make children aware of the importance of saving and to give them some lights on management, it is important to start talking early with your children about saving

I must confess that I am not a big fan of US president Donald Trump but I really like this quote from him, I think it says a lot about the importance of financial education

saving

Image credits: http://www.dividendcake.com

I don't know if you all have kids but this is basically what I am doing with mine, so here are my tips on how to teach children how to handle money

  1. Have regular conversations about money - Keep regular conversations about money and savings with your child. Do not be afraid to reveal all the information about your finances and talk to your children in a usual way about this as you would do with any other topic. A simple way to bring the money to their world is through games. There are several didactic games that revolve around the value of money, the most popular one is Monopoly, which instills a notion of expenses, revenues, income, sales and handling the money itself. There are also some nice youtube videos about financial education for kids that you can watch with them and help them to understand.  
                                      Video credits: The hen who wanted to be pink by youtube
  2. Give your children an allowance - Giving children some money is an excellent tool to understand the importance of management and savings. This helps the children to, when they grow up, know how to deal with their wages. However, do not limit yourself to just determine a value for the allowance and let the children handle it as they please, it is important to discuss with them their goals for that money, how much to save and how to spend it in a thoughtful and responsible way. childrenImage credits: https://www.investopedia.com/
  3. Encourage your children to save - In addition to the allowance, stipulate some specific goals as it also helps to sensitize the child to saving. For example, establishing a reward if your children can save a certain amount of money over a certain period of time can be an interesting incentive. However, try not to trivialize this procedure so that it doesn't fall into irrelevance. futureImage credits: https://www.in.gov/core/
  4. Stimulate conscious consumption - It is important to alert children to conscious consumption. Passing on certain ideas such as saving natural resources, sensitizing them to the difference between essential and non-essential goods, or teaching them to analyze the propaganda that attacks them on a daily basis can be critical to their financial education. Thinking before buying is a key lesson to pass. expenses Image credits: https://tradingcampus.in
  5. Take your kids shopping - Take your kids with you when you go to the grocery store. Many parents leave their children at home in this situation so as not to waste time, but it is important that they accompany them from time to time to learn certain procedures. It is a good opportunity to explain what credit/debit card you are using to pay or to show the difference between two equal products of different brands and prices and to justify why to take one and not the other. Involve them in the decision-making process, make a shopping list together and search for products on sale. money                       Image credits: https://www.insites-consulting.com
  6. Open a savings account for your children - Open a savings account for your children and keep them abreast of it. A child, from the age of 5 or 6, is already prepared to understand certain banking concepts. This will help to sensitize them to save but also to manage their money. In addition, it is an excellent introduction to certain terms that, in the future, will be present in their daily lives: interests, credit, etc.  financesImage credits: https://youthinfo.crosscare.ie
  7. Do not get in debt - Finally, give healthy examples to your children. Children tend to imitate and follow the examples they see at home. So, if you don't want your children to make certain mistakes, you should also avoid doing them. For example, do not spend more than you have and do not overdue. Remember that credit card is not the same as money because if there is no money to pay at the end of the month, interests will be high. Also, do not spend too much on what you do not need. If your children are accustomed to rampant consumerism at home, they will have difficulty setting limits in their lives. Promoting moderation is the key. allowanceImage credits: https://www.stearsng.com

These are simple advice that each one of you can adapt to your reality, but we all should be aware that financial education is the key to our children became future success adults and as soon as we start better prepared they will be. Money can bring us a lot of happiness but also a lot of troubles if we don't know how to manage it. Just do your best and enjoy your life.

Thank you so much for reading.

Written for Bitlanders by Nela 13

 



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