When a parent is thinking about all of the wisdom that they can impart into their children, one thing that they should definitely put on the top of their list is teaching kids how to be smart when it comes to money. That’s because there’s absolutely no way around the fact that, for the rest of their lives, money is going to be a factor: when it comes to their college education, buying a house and car, retirement and all of the seasons of life in between.
So, in thinking about if your own children are money savvy, we have provided a few helpful tips that can prepare them for a successful future, while giving you peace of mind in the present:
Open up a savings account. Honestly, you are never too young to have a savings account. Therefore, once a child enters elementary school, it’s time to start talking to them about it. Of course, you want to present the conversation on a level that they understand. So, for starters, consider keeping a piggy bank in their room and telling them that once it’s full, most of it will go into savings but some of it they can use to buy things that they want now. This will not just introduce them to the concept of spending, but also about the benefits of delayed gratification as well.
Make them earn “it.” It’s rare that anyone in this life gets the (tangible) things that they really want for free. Therefore, it’s a good idea that when you child has a wish list of their own that you don’t merely give them what is on it, but that you come up with ways for them to earn those items. Maybe it’s by doing chores around the house. Maybe it’s by facilitating your own book list for them to read. Maybe it’s by having them help some of the elderly neighbors (if their old enough). We’ve all heard the saying “You’ll appreciate it more if you have to earn it yourself.” That’s not a fictional statement. There is actually plenty of truth to it.
Educate them. There are plenty of educational tools out here that will help to teach kids about money. There are board games such as The Game of Life, Monopoly, Pay Day, Money Bags and The Allowance Game. There are online games that they can play as well including OrangeKids.com, PiggyBank.Disney.Go.com and JumpStart.org/Reality-Check.html. There are plenty of books that are available including Extreme Economics, Financial Peace Jr. and Money Matters for Kids. Yet, perhaps one of the absolute best ways to teach your children is by example. When you go to the grocery store, take them and some coupons along with you so that they can see how it pays to clip some. When you’re surfing online, show them websites like FreeSamples.org so that they can see that it’s possible to get some things without paying a lot of money for them if they’re simply patient enough to look. Hold a yard sale and have them help to plan it so that they can understand how to use the resources that they already have to make money. A lot of adults today are in debt simply because they weren’t given the proper money tools as children. Don’t let your child grow up to be one of them.