There are so many things we have to teach our children but one that is often overlooked in today’s world is teaching kids about money. Unless your child has a large trust fund in their name or some other financial windfall heading there way they will need to learn about personal finance. The earlier you start teaching children about financial matters the better. During the most impressionable years of their lives, young people will formulate an opinion about money that will likely stick with them throughout adulthood. With that being said, it’s important to be straightforward with kids. They need to know the value of a dollar and you’re their best teacher.
Use everyday activities to teach lessons about money.
Take your children to the grocery store. Teach them how to find the best deals by watching for sales, comparing prices, and using coupons. Purchase a small calculator for your child and work on adding and subtracting while you shop. This is especially helpful for elementary aged children who are learning to differentiate between a dollar bill and a hundred dollar bill.
Have them earn their allowance.
State your expectations clearly. Give your children chores that they must complete satisfactorily in exchange for their allowance. Gently remind them to use their money wisely. Mention how many bags of garbage they took out or dishes they washed to earn their allowance. This will put potential purchases into perspective for them. Even if they do end up spending all their money and complain about being broke, it is better for them to learn from their money problems earlier in life then they have to take care of themselves.
Use online resources to make financial matters fun.
There are plenty of websites, games, and applications that teach children about money in a fun but educational way. A few of the most popular include: thebirdy.com, Thegreatpiggybankadventure, Feedthepig.org, kids.gov.
Get your pre-teen or teenager a prepaid debit card.
Choose a card with limited fees and set up email alerts to track funds. Have your teen carefully monitor their balance and add money from their savings account whenever they need to make a purchase. This will give them the opportunity to plan ahead and account for every penny that they spend.
Schedule regular meetings with your children to discuss financial matters.
Speak to them about the rising cost of living. Talk to them candidly about credit card debt and how detrimental it can be to their credit score and financial future. Take time to explain to them the importance of higher education and the different types of aid that is available. Encourage them to look for scholarships early on. Many are awarded to children long before their senior year of high school. Rack up as many of these as possible and your child can attend college for free.
The best way to teach kids about money is to start now. Having a healthy relationship with your finances is something to be desired in today’s world. With so many people in debt and struggling to live, it’s essential to start educating your children while they’re young. They’ll grow up knowing how to determine a want from a need, how to prepare for emergencies, and how to get the best deal on the things they purchase all because you took the time to educate them about their finances.
Charissa is into frugal living and saving money.