Money Management Lessons – Kids
As parents, we try as much as we can to teach our kids useful learnings they can use as they grow older. It could be as simple as table manners, elderly respect, and caring for the environment–things that you are generally comfortable with.
The question is, have you ever thought about discussing money and teaching your kids about financial responsibility? Because the truth is, having the best savings account for kids is not enough to get them through life.
If we did not have that opportunity when we were young, we now have the power to help our kids have that advantage when it comes to money matters.
Here are some of the most important money lessons to teach your kids you can use along the way.
1. Always Save when You can
The initial reaction of most kids when they receive money is delight. Delight that they have money to buy candies or a toy they saw at the department store last weekend.
Instead of cultivating this habit, start teaching them how to keep the penny in the jar and explain to them that the more money they put inside that can, the more they will have in a few months.
The more savings they have, the more power they have to control their spending and financial decisions.
Explain to them too that what they want at the moment may not be what they want in the next month and that they might just regret it along the way.
If, for you and your partner, it is too challenging to teach them what they could achieve with their money, introduce them to simple apps and websites.
Given that most teenagers have a smartphone nowadays, they can also start using this powerful instrument to keep an eye on their own earnings and finances and learn how to manage them correctly.
If you are looking for a money-saving and budgeting app that is suitable for anybody, you can learn more here. Aside from the fun design and user-friendly built, these apps are so loved because they are efficient in helping your kids better understand the value of saving a little every day.
2. Teach them Delayed Gratification
We already know how kids are: demanding.
Every day, they want something new but it’s not every day that we can afford their flavour of the month. Teach them how to save money and make them understand that in doing so, they can purchase whatever it is that they want.
This will teach them a very important money handling lesson called delayed gratification, which they can use in many cases and in situations where they are torn about a purchase decision.
If you want to fuel their desire even more, offer them an arrangement where you match a percentage of their savings. This way, they would strive more to inflate their money.
3. Differentiate Wants and Needs
Again, kids are demanding and impulsive. When they want something, they want it right away.
This is because they do not yet have grasped the concept of wants and needs and unless you start explaining that to them, they would continue just wanting what they want when they want it if you don’t put a stop to what they have initially gotten used to.
It might be a little challenging in the beginning but as you go along the journey and include a real-life demonstration, it gets easier. After all, kids pick up what they see and not what you just tell them. So make sure you set up a good spending habit as an example for them to lead by.
As an endnote, never feel bad if there are hurdles along the way—that’s how learning should be. That’s how most of us learn best. Just remember to always be an encouragement to your kids and keep them afloat in times that they stumble.
What are you teaching your children about money?
And do you think they learn more from what you say or what you do?