Money is one of the most influential weapons we humans have. Money brings about the power to buy, and this power has to be regulated. With money, we can buy amenities, goods and services that are essential as well as luxurious. But money has to be saved to avail benefits. It should not be always splurged. Kids learn about the concept of money by observing their parents and the environment surrounding them. If they see their parents spending money easily, they are likely to learn different things about money saving and spending. Talking about money to children is tricky with the kind of questions and answers they give, but teaching kids regarding money would definitely outline the way they view and handle wealth as adults. This lesson is not taught in school and must be taught at home.
Raising Money –Savvy Kids
Every parent has to go through a stage where they have to literally fight their kid’s demand of certain things like gaming console, iPods, and latest toys. They try their best to reason out why they need it but as parents giving in to their wants is not healthy. One has to raise monetarily smart children and make them understand the concept of money no matter how bad the tantrums are. Some of the ways to raise money savvy kids are listed below:
The first lesson
The foremost thing is to make the kids understand that money has a worth, and if it is spent, it is gone, so using it wisely is a trick. They need to know where the money comes from. Parents have to be good financial role models. The concept of saving should be instilled from the age of 4. The concept of banks can be taught at home by simply giving them a piggy bank and regarding it as the child’s bank. Parents can give Rs. 5 everyday to the child and ask them to put it in the piggy bank that can be opened only at the end of the month. This money can then be used to purchase the things they wanted. This creates the impression of having earned the thing or a toy.
Monthly Grocery Shopping
Smaller kids should be taken for grocery shopping. They should be asked to find out the different prices of similar products and find the one that is priced the lowest. This will provide them an idea of the prices and how parents choose to spend money. If they ask why, you need to tell them about cutting on expenditure to buy a new car.
Older kids can be given a budget to buy a list of things. This way they would learn how to manage money on their own. They learn the price of articles, how to make and decide on what to spend, and how to save for larger purchases.
Children’s Bank Account
Now a day’s all the major banks provide children banking services. These services are for children below the age of 18. This is useful to teach the basic ideologies of managing money.