As parents, we are the primary influence on our children’s lives. This, too, includes finances.
Children learn concepts from a young age, and even as young as three years old can make
sense of concepts such as saving and spending.
Use a few steps and help them in the right direction to understanding the importance of
1. First steps
You can start by opening a bank account for your children. A savings account is a great
option as it will teach them the responsibility of ‘owning’ their bank account.
2. Smart Saving
The next step would be to encourage your children to actually put money into their bank
account. Let them create a wish list, so they can see why and what they are saving for.
Teach them that their money grows. For example, when a certain milestone has been
reached in their savings, reward them with a form of “interest”. This can teach them that
their money can grow if they are disciplined about saving.
3. Money has value
It is important to teach your children that money has value and that you have what you’ve
earned. Link money to chores – with every chore completed, they earn a payment. Consider
also, that money should be spoken about at home as a privilege, not a necessity. Teaching
your children to value money will help encourage their own budgeting. The best way to
teach your children how to manage their money is to actually give them some.
4. Needs vs wants
Children should be taught the difference between a need and a want. Lessons about money
can also include learning about prioritising. Needs are the things you use every day and
cannot go without. Wants, however, are things that you would like to have. Chat about how
needs must be met before satisfying the wants.
You could also make money lessons fun. Perhaps set up a family savings goal. Here the
entire family could participate in a savings plan for a family holiday, or another treat that the whole family would enjoy. When you go to the supermarket for groceries, ask your child to help. Let him look for specials and the best deals. In this way, he will find value in products and services to benefit the whole family. Always remember, children learn by actions, not words.
Speak to One Debt today for more information.