Financial literacy is one of the most important things you can teach your kids. How to spend money wisely? Is it good to take loans? Your children will need to find the answers to these questions and learn how to use money in the most effective way. In this post, you will find some tips on instilling the right money attitude in your little ones.
Talk About Money
This tip perfectly fits the youngest kids. You will need to cover the list of topics and provide your children with a basic understanding of what money actually is. Most professionals recommend starting your lecture with this information:
- Why do we need money?
- What is the difference between paper money and coins?
- Why do most grown-ups work?
- Why do you need to pay for goods at the supermarket?
- Types of money, including cashless options
- The difference between the needs and desires
- What will be if you lose all money?
Not to mention, you don’t need to cover all these topics during one conversation. You can talk about money with your kids regularly, giving them more new information from time to time. This way, they are likely to remember all the necessary facts much better.
Keep The Money Safe
Your kids should know that it is necessary to keep money safe. Don’t forget to talk about why it’s important to keep money in the right place and how you do it. Financial security is one of the most necessary topics for discussion for both little ones and teenagers.
Allow Them To Have Savings
Most kids can start saving money at the age of 5-7 years old. Moreover, some of them might want something their parents don’t want to buy. This is the best time to teach them how to save money. Moreover, saving can also improve the responsibility and independence of your kids. If you don’t know where to start, feel free to try this schema:
- Allow your children to choose a particular goal. For example, your kid might start saving money to buy an expensive toy;
- Visualize the goal. Your children can draw something they want to buy. This simple trick will help them understand their feelings and desires better;
- Offer solution. If your kids want to buy something, they can save money for it;
- Find some space. It is good to give your kid a piggy bank or a box to store money. These are the best places where your kids can keep their finances safe.
- Enjoy. Let your kids make a purchase after they collect the required sum of money.
It is important to note that teenagers should also learn how to spend money wisely. Most caring parents give their teen children pocket money. Moreover, it is necessary not to control their spendings. Your kid might save money, spend it on buying gadgets, goodies, presents, or even get some custom term paper writing to solve their academic issues (yes, most teens don’t mind using a cheap essay writing service.) Anyway, having pocket money can help youngsters become financially literate and pay not only for goods but also for useful services.
Become An Example
If you fail to save your money and usually spend everything you earn, your children are likely to follow this financial habit, too. What does it mean? The best way to instill the right money attitude in your little ones is to get brilliant financial habits yourself! For example, you can tell your kids that you are saving money for their education, share the process of receiving money on your bank account with them, and even tell the basic facts about the functions of the financial system.
Provide An Opportunity To Earn Money
This tip works better for teenagers rather than for younger kids. The main thing is about allowing your children to earn money by themselves. Moreover, many parents believe this method is the best alternative for teaching them financial literacy. The number of jobs available to teenagers is very diverse. For example, your children might work at cafes, restaurants, gas stations, libraries, college campuses, and other places.
On the one hand, your kids will have an opportunity to better understand the value of money, save money, and spend it wisely. On the other hand, the children can gain new skills and knowledge important for building a career. Moreover, they will have at least basic experience of working and communicating with dozens of different people. However, don’t forget that your children shouldn’t work full-time not face serious academic issues. Having a job is surely great, but it should harm the studies.
Conclusion
Being financially literate is a must for any person. It is better to teach your kids how to manage their personal finances from early childhood. Allow them to have pocket money and spend it for their particular needs.