There is no doubt that you want to do the best for your kids. You want to give them the most comfortable and luxurious life you always wanted to have during your childhood. There is no harm in giving them the latest clothes or coolest gadgets, but you also need to inculcate good habits to do well in life.
Similarly, having the working knowledge of money will help you build your child’s financial literacy and character. Let’s not forget money is an integral part of life. Everything we do involves money in one way or the other.
So, besides the coolest gifts, give your kids some financial literacy right from an early age. Here’s how you can get started with teaching in the right direction.
Start With Basics
As per the experts, you begin the lessons before the age of seven. So, when they are old enough, start introducing coins and cash. Explain what money is and how they need to use it. Actually, showing how money works will be a great lesson. For instance, let them see you buying things using cash.
Of course, in this digital age, you might be using a debit or a credit card. So, explain to them you are using money to buy things. You must show them receipts for the purchases.
Teach Them a Habit of Saving
You introduced money to your kids through spending. Right? So, you need to teach them simultaneously the importance of saving money as well. This learning won’t only teach good money habits. In fact, this will also help them with understanding discipline and gratification.
How? Because this habit teaches them goal setting and planning. For instance, you can help them understand practically in later stages by getting them a debit card for teens. Doing so will help you set saving goals while tracking their spending patterns. This will help you teach them the art of spending wisely through practical experiences.
You can begin with short-term goals and allow them to learn to understand the importance of savings.
Make Them Learn The Art of Earning Money
You can’t keep on giving them money to teach money habits. They need to learn the process of earning money and using it. You can start it by giving them an allowance. But don’t give them just like that. Ask them to do certain chores to earn their allowance.
By doing this, they will start learning the value of money by earning it right from a younger age.
Make Them Learn Smart Spending Decisions
Now you made your kids understand the importance of money and how they can earn it. But they need to understand the art of spending as well. Let them know they can’t spend money like drunken sailors.
So, when you give them an allowance, make them understand that this is all they got for a week/ month, and it’s up to them to manage it. By doing so, your kids will start tracking money and learn how to budget it.
Wrapping up
Instilling good money habits is essential to prevent them from falling into financial pitfalls. But besides this, you need to teach your kids that they can grow their money as well.
This is where you need to teach them about investments. Try to pass on your knowledge and insights to your kids and lay a foundation that allows them to do well in their life.
