Given how important financial literacy skills are to navigating life, it’s surprising that our schools don’t teach children about money.
As a parent, however, you can teach your child important financial lessons — and you should.
Below, I’ll show you how to give your kids the head start you wish you had and set them up to win with money at any age:
Preschoolers & Primary School Kids:
Use a clear jar to save
When you use a clear jar, they see the money growing. As the money grows, make a big deal about it with them.
Set an example
“Little eyes are watching you”. Your kids are likely to replicate the behaviors you have with money therefore set a healthy example for them to follow.
Show them that stuff costs money
You cannot just ‘tell them’. For kids to understand the concept, take out a little money of theirs from their jar of savings and pay for something they would like.
Show opportunity cost.
That’s just another way of saying, “If you buy this video game, then you won’t have the money to buy that pair of shoes.” At this age, your kids should be able to weigh decisions and understand the possible outcomes.
Give commissions, not allowances.
Don’t just give your kids money for breathing. Pay them commissions based on chores they do around the house like taking out the trash, cleaning their room, or mowing the lawn.
Avoid impulse buys.
Encourage your child to wait at least a day before they purchase anything over R300. It will likely still be there tomorrow, and they’ll be able to make that money decision with a level head the next day.
Stress the importance of giving.
Once they start making a little money, be sure you teach them about giving. They can pick a charity or even someone they know who needs a little help.
Give them the responsibility of a bank account.
By the time your kid’s a teenager, you should be able to set them up with a simple bank account if you’ve been doing some of the above along the way. This takes money management to the next level and will (hopefully) prepare them for managing more money when they get older.
Get them saving for university
There’s no time like the present to have your teen start saving for university. Do they plan on working a December job? Perfect! Take a portion of that (or more) and toss it in a university savings account. Your teen will feel like they are ‘adulting’ as they make a contribution to their university funding.
Get them on a simple budget
Now is the time to get your teen in the habit of budgeting their income—no matter how small It is. They should learn the importance of making a plan for their money while they’re still under your roof.
Help them figure out how to make money
When you think about it, teenagers have plenty of free time— Every.School.Holiday.If your teen wants some money (and what teen doesn’t?), then help them find a job. Better yet, help them become an ENTREPRENEUR! These days, it’s easier than ever for your teen to start up their own business and turn a profit.
Teaching your children about money at any stage is going to take time on your part. It won’t always be easy. But if you want your children to know how to successfully manage their money when they get older, taking the time now will be worth it.
Have you implemented any of the above tips in teaching your kids about money? How effective has it been for you? Do you have any other tips for teaching kids about money? Let me know in the comments below.