5 Ways to Teach Your Kids The Value of Money
The amount of people in this world who have racked up sky-high debts, rely on credit and borrowing to get by and seek bankruptcy and insolvency after things go wrong is highly worrying. I believe that much of the issues that people have around finances comes as a result of poor education in their youth and the lack of real respect for what money is, and how it should be managed. For this reason, as parents, we have a responsibility to our children to teach them how to value money and here are 5 ways that I have used to show my kids exactly that.
Having a strong ethos when it comes to saving is something that will stay with you and greatly help you through your life. In order to best get the message across about savings, I like to play a game with my kids. The game is basically this, amongst my 3 children, whoever can save the most of their allowance, will have their savings pot doubled every 3 months. The result that I was looking for really worked and my kids were highly competitive in terms of who could save the most. Along the way, my kids also saw just how much they could amass if they saved up their allowance.
Many parents seem to want to hide their financial dealings and whilst of course your kids don’t need to know everything, a little exposure can help them out. For this reason I like to take my kids to the bank whenever I can and talk them through what is happening with the family’s money. My kids love coming with me and are always ready with thousands of questions for the clerk.
Put Them To Work
Handing out an allowance is going to teach your kids that money will just come to them, something that most certainly will not happen in real life. Instead of this, I will put my kids to work and if they have not completed their chores, they will not get any money. I also like to put a couple of bonus chores on the board, usually the really boring jobs, and for this I will pay and additional amount. The kids have taken to this very well and are beginning to understand that they need to work in order to earn.
Don’t go crazy at your kids when they make a rash purchase or waste money, this will not help them. Instead of this you should sit down with your child and discuss why they did what they did, why they regret it and how they can fix it or avoid it in the future. This review system is the best way to show your kids the error of their ways.
All At Once
I decided to start testing my kids’ resolve a little by giving them all of their lunch money on the same day, instead of handing it out daily. This is something that you could also do with their allowance and it will help them to learn how to pace their money and how to manage large amounts.
How do you teach your kids the value of money? Let us know your methods, we’d love to hear from you.