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How to Teach Kids About Money

Can you afford to not teach your kids about money?

Teaching children about money is an important part of their development. By learning that making money requires effort and dedication, they will have a better grasp on how to manage their money as adults.

Here are some tips on how to help introduce children to the concept of earning and saving money.

Money doesn't grow on trees.

When kids see money being dispensed from an ATM, they might think it’s like water coming out of a tap. Help them understand that you have to work to make money. The harder you work or study, the more likely you are to earn a good salary. Money isn’t everything, but it’s important.

Work within your budget.

By learning to prioritise what they need to buy, instead of spending all their pocket money on one item at the beginning of the month, children can stagger their spending. It’s a valuable lesson that can help them in later life. It will teach them to appreciate how budgeting can make their allowance last longer.

Have a wish list.

We can’t always have everything we want at the same time, so teach your children to set priorities for themselves. Help them make a wish list, putting the most important things at the top. Saving up for something they really want may be better than spending money on an ice-cream.

Delayed reward is more gratifying.

To avoid developing bad habits and bad debt in later life, teach your kids that waiting pays off. Saving for several weeks to buy a new skateboard, for instance, will help them appreciate its worth.

Raving about saving.

Open a bank account for your children so they can see how savings grow over time. Teaching them to save also encourages them to plan ahead. In later life, having money saved for emergencies, or other unforeseen events, can help prevent them from getting into debt.

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