The growing numbers of foreclosures and debts amongst Millennials are indicators of financial instability. They demonstrate that knowledge about managing money isn’t as common as it should be. To ensure the next generation avoids this problem, teach your children about money and financial management at an early age.
Teaching kids about money is essential for helping them become responsible adults when they grow up. Not all schools teach financial skills to children. Being parents, it’s your duty to ensure they have this knowledge.
Here are 6 ways to give your children some valuable financial lessons.
- Teach Them to Wait
Some kids are stubborn and throw tantrums when you refuse to buy them something they want. If you give in to the demands, children will never understand the value of money. Make them learn that money is valuable by delaying the purchase and having them save their own money to buy it.
- Use Cash Rather Than Credit Cards
Physically handing over the money to the cashier instead of using credit cards or online payments, will make your children see money as a visible object. If the money is invisible, they won’t be able to understand finances. The best way is to give them some money and let them make the payment to the cashier.
- Take Them with You to Banks
It’s important for your children to understand the concept of banks at an early age. Tell them that the money you earn is safely kept by the bank and it’s limited. By experiencing the actual transactions taking place at a bank, they’ll get some financial lessons regarding money flow.
- Set a Goal for Them
Set a goal for your children such as buying a bicycle or a special toy they want. This practice will encourage them to save money rather than spending it junk food and trinkets. Make sure that the goal is not too expensive. Give a specific amount of monthly or weekly pocket money to your kids to help them achieve that goal.
- Give Rewards Rather Than Allowances
You children always see cash coming out of ATMs. Therefore, it’s important for them to understand that money is earned by working hard. To accomplish this, reward them with a commission for doing chores such as mowing the grass, doing the dishes and cleaning their room.
- Teach Them to Make Wise Choices
Have your children understand that money is finite and it should be spent wisely. Teach them to weigh decisions and realize which one makes more sense. For example, tell them ‘if you buy that jar full of candies, then you won’t have enough money to spend on those new story books’.
Help your children understand the value of money with various activities and lessons. It won’t be easy, but it’s worth it for a better future for them. Start it today by gifting them a piggy bank.