Why Teach Your Kids About Money And Finance?
As a parent, you have the authority and power to shape your kids’ habits, personality and character. It is within our duty as parents to provide, nurture and teach all that is good, virtuous to our kids. One of the most important skills that every kid should have is the ability to manage money.
Giving kids financial knowledge sets the path for success. Knowing the fundamentals at a young age can make a difference. Just like riding a bicycle, it becomes instinct and muscle memory and it is the same with money. The earlier they are taught, the faster they catch on.
How To Teach Young Kids About Money?
You don’t have to be an expert in finance to teach your kids about money. It requires your patience and optimism. Read on for four good ways how to teach young kids about money below:
- Lead By Example
An apple doesn’t fall far from the tree. There is no doubt that kids take over the habits, customs, or behaviours of their parents. Your perception about money is reflected in your behaviour, so let’s help your kids to have a strong foundation of financial knowledge and money habits.
- Talk About Money
Start the money chat. Introduce the “value or concept” of money to your kids. You can start a conversation about money when the opportunity comes up at home or when you’re with them .Show them why some items or experiences have different price tags. Do not undermine your kids’ lack of understanding about money especially when they want something that is out of your budget. Look from their point of view
- Saving Habit
Introduce saving to your kids. The pocket money kids receive for their school or chores and “angpow” from relatives during festive seasons can be put into savings. Get them a piggy bank and explain the needs for saving money so they can purchase the toys they want in the near future. This also will teach them about delay gratification. There is no doubt that delay gratification can save so many people from impulsive buying and tendency!
Encourage your kids to donate some of their savings to charity. They can also donate their used toys and clothes. Although these items are not money, they also have values in them. This teaches them that money can be used to help people, and is not just for buying things.
No One-Size-Fits-All-Approach In Teaching Money Skills
Just as parenting isn’t a one-size-fits-all approach, neither is teaching about money skills. Your kids may respond differently to what you are teaching compared to other kids. You may have to try out a few methods and approaches before you find one that they respond to.
Remember to talk comfortably about money whenever you can with them. Always include them in conversations and actively demonstrate how to be financially responsible early on. This will help them to cope with challenges like setting financial goals, planning a budget, and resisting impulse buys. So dear parents, this will not be an easy task but it’s not a hard one either. All the best from all of us at Kath + Belle!