There’s no parent who wouldn’t want his/her children to be successful in life. Most parents will agree that it is important to unleash their kids’ academic potential while also teaching them life skills such as playing piano and participating in sports. However, teaching your kids about money is arguably the best education any parent can give to his children- and it is often overlooked. In addition to offering your kids an important life lesson, giving them an early understanding of the value of the dollar will make them financially responsible and ultimately prepare them for life in the real world. As such, here’s some advice on how to teach your kids about finance.
Habits, whether financial or psychological, are developed from an early age. This is why it’s crucial to start teaching your kids about money from a very early age. According to several behavior experts at the University of Cambridge, kids can learn and form their money habits as early as when they are 7 years old. With that in mind, teaching your children about money from an early age will effectively give them a financial head start.
Make it Fun
As a parent, you should know that teaching finance to your kids should neither be structured nor boring. In other words, do not use overly structured lessons when teaching your kids about finance. Not only will they be bored to death, but they will be less likely to retain this type of information as it will fail to hold their attention and won’t make any sense to them. Instead, make the financial lessons as fun as possible. Remember that kids learn a lot better when they’re engaged and having fun. For this reason, you should get creative and make the lessons interesting and relevant to the kids. For instance, engage them in piggy bank activities and use experiential play to teach them about finance. In essence, role-playing activities are fantastic ways of teaching your kids about finance while still making it fun and relevant.
Introduce the Concept of Money
While it’s important to teach your kids sound financial strategies at an early age, it’s just as important to introduce your kids to coins and currencies first. You should teach your kids to value coins and encourage them to save them in their piggy banks. Consider using a clear piggy bank so that your kids can see their money grow- it’s important to capture their attention, and this clear visual of their savings growing over time may be just the trick!
Lead Your Kids by Example
You shouldn’t preach one thing to your kids, while doing another. It’s important to explain to your kids what you’re doing. Make sure that you explain to them when you write a check, when you pay for groceries, and even when you use an ATM card. You should also encourage them to avoid impulse buying. Remember, kids are observant and will mostly copy what their parents are doing.
Let them Earn their Own Money
It’s crucial to let your kids work for their own money. Instead of just giving them money, let them work for it. For example, give them commissions for doing various house chores. By doing this, you’ll teach them to work hard for their money. And when they grow, they’ll know the essence of working summer jobs, becoming entrepreneurs, and they’ll be on the right path to better investing habits.
There are, of course, a lot of ways to teach your kids about finance. Whether you teach them various aspects of budgeting, saving, planning or earning, it’s fundamental to raise financially savvy kids. At Dayton and Sydney, we are dedicated to creating personalized financial strategies and promoting better financial habits. Call us on 516-358-3904 and we’ll help you through your financial journey.
This article is for informational purposes only. PPG-139592 (9/19)(Exp. 9/20)
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