Parents would like for their children to grow up and become successful adults. Part of being a successful adult is having the ability to manage your personal finances. Truly, it doesn’t matter how much money you make, if you don’t know how to manage it, you can still end up in financial trouble. Money management can be complicated, even for adults, but these tips will help your children stay on the right path and enjoy a simple living when it comes to finances.
- Start Early. As soon as your child is old enough to understand numbers, introduce the concept of money.
- Communicate About Important Topics. Teach your kids about saving money, how to set goals (save for that toy they really want), and how to spend it wisely.
- Make Them Earn It. You can give your child a list of chores to do in exchange for some extra spending money. This will help teach your children about the value of a dollar.
- Encourage Saving. Encourage your kids to save their money. A great way to encourage this is to pay interest on money your kids have saved at home or to match their savings.
- Let Them Pay. Give your child the cash to pay at cash registers or parking meters. This will get them used to handling money, calculating change, etc.
- Play Games with Money. Playing games that use fake money is a great way for your kids to get practice (who doesn’t love Monopoly?)
- Make Them Deal Hunters. Take your kids to the grocery store and see if they can find the best deals on the items on your list. Show them the difference between high quality low price items and poor quality higher priced items.
- Teach Them to Give. While saving money is important, it’s also a good idea to teach your children about giving to charity.
- Help Them Set Goals. If they want something special, help them make a savings plan to reach their goal. This is great practice for the future.
- Let Them “Play” the Stock Market. Teach them how the stock market works, and let them pick some stocks and follow them. You can keep track of how much they have “gained” or “lost”.
- Explain How Credit Works. Many young adults end up getting into credit card debt, so it’s important to explain credit to your children and how it works at an early age.
- Let Them Have a Bank Account. As your child gets older, it’s a good idea to let them have their own bank account so that they understand how the banking system works.
- Encourage Your Teen to Get a Job. When your children grow into teens, encourage them to get a part time job. This will introduce them to the real world and help them understand that you have to work hard for your money.
- Teach Them to Budget. When you child is a teen, help set a budget to keep track of income and expenses such as car insurance.
- Teach Them About Retirement Savings. It’s never too early to start thinking about retirement savings. Talk to you children about the benefits of investing early.
These tips can put your kids on the right track and ensure they start down the road to financial success. The earlier you start, the better the chance of your children doing well with their money.
This article is provided by Simple Living Australia – a personal finance and lifestyle blog dedicated in helping people control their money. Find a range of articles covering debt, savings, insurance, investing and more. Follow them on Twitter @SimpleLivingAus