That’s right, and it starts as soon as they can count! It’s just that the methods and lessons change as the children grow and can understand more.
Use a transparent jar
It’s a go-to sort of present, really, a cute piggy-bank; but there’s no real visual impact as the child can’t see through it and watch their money grow. Last week there were eight shiny pound coins, this week there were nine and next week there’ll be a ten-pound note!
Be the example you want to set
The children will pick up your attitudes towards money so if you think the answer to all life’s problems lies with your MasterCard then you’ll pass this straight on. This is a bad thing, by the way… If you know you have some bad money habits, then you could do worse than consult Creditfix to get some advice and pointers.
You also need to talk about money when you’re out shopping or shopping online. Explain that you’re only going to spend, say £80.00 and so you might have to put back some items to stay in budget.
It’s also a bad idea to argue about money in front of the kids because they’ll see finance as a source of stress and therefore something to avoid.
Give the kids chores
Children love having little jobs that they can own. These jobs could be raking up leaves, checking to see if the hens have laid eggs or washing the car. Having a job demonstrates how money is earned, not just given out, although it’s good to give them an allowance too.
Make sure they give some money away
Charity is a big deal to children as they can feel that they’re doing some good in the world. Encourage your children to give away some of their money to charity each month and reinforce to them how their donation is going to help the recipients.
Teach them to be content
This is one of the biggest – and hardest – lessons to get across. Children are confronted with images of wealth and glamour day in, day out. It’s important for children to realise how lucky they are to have a roof over their heads, good food and some money, even if it’s only a few quid.
Open a bank account for them
Children can have their own bank accounts from when they’re seven or so. By this age, they’ll have absorbed some of your teaching and they’ll be enthusiastic about making regular deposits. They don’t need to see physical money growing in a jar at this age – numbers on a bank statement will do nicely. Once they know about compound interest and how it essentially gives them free money, they’ll love saving. This is great practice for handling larger amounts like salaries.
Encourage them to budget
You can download a budgeting app to your older child’s smartphone so that they can get into the habit of recording everything they spend. They can also see how much they have left over each week to save up for a big purchase in the future.
Educate them on investment
It’s something that we’re not really taught about extensively in school but the investment is something that every child should learn from a young age. The investment comes in many forms whether that’s savings accounts with banks to investing on the stock market. It’s helpful to provide them with all the information they need when making their money go further in the future.
For example, there are lots of property investment opportunities available that could potentially set them up for early retirement in the future.
Explain the Concept of Debt
Does your child say they’re desperate to buy that new computer game? Teach them the principle of debt by lending them the money and have them repay you in weekly instalments. If they miss a payment, take money out of their allowance to teach them that borrowing money can have consequences if they’re not careful. Stress the importance of only borrowing what you can afford, only when you really have to, and from a reputable lender such as Flexy Finance.
Put them out to work
In a health-and-safety conscious way, of course, not cleaning chimneys! Teens love earning their own money, so help them to find baby-sitting, pet-sitting, fruit-picking and dog-walking opportunities. If teens are earning their own money then they develop a magical ability to look after it more…
*collaborative post*
Leave a Reply