Money is something that looms large in our thoughts, and whether it’s preparing for your family’s financial future, or you are just trying to make ends meet right now by paying bills (TIP: if you are finding your bills are too high then try Simply Switch to help find a cheaper service), it’s always going to be something that dominates your thoughts. And while you may be worried about money, this can transfer to your children. This could prime them for money worries when they get older. But, this shouldn’t be the case, and when your children are young, this is the best time to start teaching them responsibility when it comes to money. So, how can we do this?
Lesson Number One: Money Doesn’t Grow On Trees
Your children may see money come out of an ATM, and think it’s an infinite resource. It’s important to explain that as soon as possible that you need to work in order to make money. As soon as they understand this and that people have to live within their means, the better their attitude will be towards money and goods and services.
Lesson Number Two: Working Within A Budget
Logically, as money is not infinite, you can start to teach your children how they should learn how to manage money. If they want something, then you can help them by saving their pocket money, and when they have enough pocket money, they can purchase the item. Because if they decide that they want something else in the meantime, and the end up blowing all of their pocket money on something else, meaning they can’t afford the thing they really want, this is a very valuable life lesson for them.
Lesson Number Three: Saving Is Important
Saving up for something that they really want isn’t just good and practical common sense, but it instills in your child the value of mooning something. You may want to pay them pocket money for chores they do around the house, which means they can learn the value of hard work and the rewards at the very end.
Lesson Number Four: Understanding The Importance Of Financial Matters
This is something that many adults don’t have a grip on, so it’s always best to teach your child how finances work in the world. I know people who use 7Wealth for help managing money and they say the whole process has been extremely helpful. The importance of shopping around for a bargain, for example, is a very important skill to learn. In addition to this, things like exchange rates can be a handy tool in their back pockets or when they want to start investing with all of its pros and cons. The idea of a nest egg or saving is a very vital ingredient to saving money in the modern world, so it benefits your children to know about various investment options, whether this is Bitcoin, Hong Kong coins, gold, or real estate, these are all important things to learn. And yes, some of it can be very complex for a very young mind, but as your children grow older and have the basic knowledge in place about financial transactions, and the value of earning money, you can turn this into a suitable grounding for their overall financial attitudes in life.
Teaching your child about money can start as soon as they are competent, and if you do it right, this will set them up for a very well balanced financial life.