As parents you teach your kids everything, and finances should be no different. Sometimes parents neglect teaching their kids about money because they do not want them to worry about something like money during childhood. However, putting off financial discussions with kids can have big negative effects when they grow into adults. Below are several tips for how to teach your kids about finances.
Teach the Difference Between Needs and Wants
Kids are good at wanting just about everything. This is a good time to start discussing needs versus wants. Is that newest toy or latest video game console a true need? Not in most households.
One great way to help kids see the difference is to set up a paper with “Needs” on one column and “Wants” on the other. Then, have kids name the items they are asking for, and help them categorize them into which column they belong in.
Set Specific Goals
Do not just tell your kids to save money. Actually help them set a specific goal. Are they going to save 15% of every dollar they get? Is there a specific amount they are saving towards? Help your child create a plan for achieving the goal. Perhaps even make a visual chart that he or she can visually see how close to the goal they are.
A specific goal is something your kids can try to reach, and accomplishing financial goals early will help set them up to accomplish financial goals later in life too.
Everyday Teachable Moments
Do you take your kids to the grocery store? This is a time to start teaching them about finances. Get your kids to help you make the list of items to buy at the grocery store, and then set a budget for the trip. As you shop, get your kids to help you make choices about what size and brand of items to buy based on the budget. Help guide them to make the choice that will keep to the budget.
Other daily teachable moments would include opening and paying bills, planning a birthday party, planning a vacation, or saving for a special item or event. Check out these tips for more ideas.
Do Not Hide Financial Problems
Be up front with kids even if your household has financial difficulties. Even taking your kids with you to North Bay bankruptcy appointment, such as with Paddon & Yorke Inc, is a great way to show them the importance of staying on top of finances.
Teaching your kids how to control their own finances you will be giving them the ability to lead a financially stable life. It only takes a bit of time out of your day, but it can yield piece of mind to your posterity for generations to come.