Financial education should start at a very young age. As soon as children can grasp concepts, it’s best to start educating them about managing money. This way, you’ll set in them the value of saving and spending wisely.
Here’s how you can teach children about money management:
Start with yourself
Where do young ones pick up habits? From the people they see each and every day. So showing your kids how you handle money helps establish how they will interact with it in the future. It also helps when lecturing them about spending habits. For instance, it’s so hard to scold them about credit card use when they know how much you love to swipe that plastic.
Let them know how hard it is to earn money
Kids can always ask for something and they will most likely receive it. But it’s always best to remind them that money doesn’t grow on trees. The money used to buy the Barbie Doll they wanted for Christmas took days of labor to earn. If they are up to it when they are a bit older, encourage them to take a summer job so they can learn the value of hard work.
Create opportunities for decision making
This is a reinforcement of the idea presented above. Let your children decide whether they should buy a certain thing or not. For example, if they ask you to buy a sweater their favorite artist wore, don’t just immediately buy it. Ask them questions about why they want the item so much. This way, you’re teaching them the difference about a necessity and a want.
Yes, it’s hard not to shell out money these days given how clever advertising has become. However, teaching children good money habits at a very young age can help them be better spenders and savers as an adult.