Teach Your Kids About Money
Some people say that: “Money makes the world go round.” Others emphasize that “the love of money is the root of all evil.” As far as I’m concerned, money is really a neutral object. It’s our attitude towards it and how we use it that gives it its ultimate character.
As parents or adults, it is up to us to start teaching our kids or kids around us about money. For as long as they live (just like us), our kids will have a need for money and it is ideal to get acquainted with it and be comfortable with finances as early as possible.
As soon as your child can recognize numbers or money, you can slowly teach him or her about financial matters. Actually, as early as when your child can already recognize colors, you can start introducing your kid to the world of money. The blue bill is P1,000; the orange one is P20 and so on. You get the picture.
By the age of 6 or 7, it may be ideal to start giving your child a weekly allowance. A weekly allowance will teach them discipline as they will have to budget their money throughout the week. They will discover what it feels like when they splurge all their money in one day and have nothing in their pockets by Friday. Giving your child money will teach him/her communication skills, math skills, and decision-making skills. Your child wants to buy something? He or she will have to choose the item and speak up. He will also have to compute for the right amount of change. Handling money will also teach your child to be responsible as he or she will realize that he or she needs to secure his or her belongings and/or resources or lose them.
It is important to teach your child to save early on. Teach your child to set aside 10-20% of his/her allowance for savings. Open a bank account for your child. Take him/her along when you visit the bank. Explain to your child the concept of earning interest. Show your child how his/her money is growing as you show him or her the passbook or bank certificate.
Teach your child to be giving too. Allot 10% of his/her money to give to church or to the organization which provides him or her with spiritual food. A habit started early in life will surely be carried on into adulthood.
Lastly, also teach your kids to learn to enjoy their money. Money does not exist just to be kept, saved, or given away. It is also meant to buy you things for your enjoyment. Once in awhile, allow your kid to buy something that will really be a treat for him or her. A favorite dish. An interesting book. The perfect toy. Teach your child that if he or she wants something, your child will need to work for it or save up for it. Reserve your gifts (as parents) for special occasions or when your child does something outstanding. Any other time of the year, your child can have a fund which he or she can use for things that he or she would like to buy, subject to your approval, of course.
With these steps, you may well be on your way to introducing your child to a life characterized by healthy finances.