Budgeting and saving money in South Africa is an important skill to have. Learning it early in childhood can help avoid financial troubles in adult life. Teaching your children how save their money and plan their spending is a wise move that will benefit parents as well as children. With proper money management comes better living.
How do I teach my children proper money management?
Whether a child is getting R50 a month in exchange for chores and housework, or a larger allowance, their pocket money is the best place to start. Using money as reward system, i.e. for chores, teaches them that money should be earned through work and not just handed out. Set realistic tasks for them to work towards in order to earn their allowance, which also strengthens from an early age the values of hard work and commitment. Allowing children to spend their money on treats and toys is another example of money as part of a reward system, and it is amazing how hard children will work to save up for their heart’s desire. Furthermore, children should be shown how to spend their earnings.
To familiarise them with the importance of budgeting, some parents choose to share the household finances with their children. If this is not for you, a simpler exercise could be to use three piggy banks – one for saving, one for spending, and one for giving. Each time they receive money it gets divided equally between the three jars. The importance of saving up is stressed, as well as the importance of giving and donating.
In South Africa, saving money is difficult
Many South African families struggle to provide pocket money for their children. There are still ways to teach children about money without using any. For example, you could use sweets or tokens to represent money (which works well for younger kids). Involving children in financial affairs from an early age is important, so that when the time comes for them to leave home, they are well-equipped to handle the financial responsibilities of adulthood. Speak to One Debt for tips on how to stay out of debt in South Africa.