3 Golden-Rules Parents Should Use to Teach Kids About MoneyMay 26, 2021
How do you teach your child the value of money?
Have you ever met a child who didn’t understand the value of a dollar? Some people view such naivety as adorable, but it’s actually problematic. It’s a problem because countless kids who have no idea about money, end up learning how to use it through trial and error. Expensive errors. When it comes to an issue as serious as financial literacy, it’s never too early to start teaching kids right from wrong. Finance Expert Geoff Williams advises that “Imparting important financial lessons, including saving strategies and money-management skills, is crucial to help your children achieve long-term success. Teaching your child how to save and spend wisely can shape his or her future attitudes toward money.”
Here are a few tips on how to foster strong financial literacy in your kids:
1) Talk Candidly About Money
Parents often make the mistake of keeping silent about money in front of their kids. They do this with the intention of sheltering young ones from financial stress. While it is healthy to let kids be kids, don’t raise them in a financial bubble. Teach them what it means to afford things, and to save for expenses. Let them know when tough times come along, and the household needs to go easy on spending.
2) Teach them How to Use Piggy Banks
Piggy banks are a great technique to explain elementary lessons on saving. If you have very young kids, all they need is this simple toy to develop an appreciation for money. As kids approach adolescence however, step things up by introducing them to actual banks. Give them an allowance, then teach them how to budget and transact with real financial institutions.
3) Teach Them How to Distinguish Between Wants and Needs
It’s one thing to teach kids how to budget with money. But teaching them how to prioritize their spending is a totally different ballgame. This is mostly because children have little reason to be aware of life’s necessities. Parents bear the burden of catering for food, shelter and clothing. Even though most of what they want to spend on will be frivolous, make an effort to demonstrate the difference between wants and needs. Show them how to identify spending that’s a must, as opposed to spending that’s optional.
Kids can gain a lot of knowledge from books or school. But there are some sacred things which only parents can teach. How to handle money, is just one of these sacred things. Having the temperament to manage money well requires discipline, and responsibility. So the sooner you teach your kids to treat money with respect, the likelier it is that they will mature into adults who make wise and profitable decisions. If you like what you just read from our blog, you’ll love the various informative courses, workshops and events listed on our websites and social media. Whether you’re interested in personal development, or overall improvement of your business, give us a call at 1 (888) 823-7757 to find out how The RISE Academy can help you break past your daily struggles and start soaring in success. For business development coaching by Richard Martinez, call at 626-202-2291 or follow us on Facebook and Instagram.
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