So, let me begin by asking this – How do you teach your kid(s) about money and its value? Tough one, Isn’t it?
Television advertisements, Electronic gadgets make it even tougher for parents to let kids understand about money and its value. I usually find it difficult when we go for groceries with my little one and say “NO” to her demands of toys and clothes!! Am sure most of you will share the same experience. Correct?
This is just my small effort to suggest a few ways to help kids understand money and its value:
First and most important this thing is – It depends on parents and their attitude towards money. We know kids learn a lot through observation. If everyday kids watch you debating about money or if money is a stress factor in your family, it will most likely have a negative effect on them. On the other hand if money matters are discussed in family with proper solutions it has more positive effects.
Parents spending habits also determines kids attitude towards money (best example movies). Many parents give their kids whatever they demands (even if it’s too expensive) which is very bad for kids. Now don’t blame your kid later by saying “Money doesn’t grow on tree”! Saying “NO” sometimes is really needed. Let them know that “money is limited”!
Avoid long explanation about value of money to kids. It’s just a waste of time and energy. Your kid either will get confused or will get nothing out of it. Rather teach them to share and take care of their things like toys, books, games, picking and keeping them at right places. It’s a very basic thing but it teaches qualities like sharing, responsibility, discipline, organization and most important value! Also try to do the same for your own things at home as kids learn more through observation. Action speaks louder than words, remember that.
Let kids purchase their own stuff. Start with small things. Give them some coins to purchase a pen or pencil. It will help them understand a very basic thing – “money” is a way for exchanging things.
Let your kid know how money comes. Tell them that mom and dad needs to ‘work hard’ to ‘earn’ it.
Teach them habits of Savings and wise Spending: Teach kids to save and how to spend wisely. Tell them money is not just for spending but also for saving. Make budgets and stick to it, try to save, even if it’s a small amount. It does matters a lot!
Make them understand that money is limited so when they demand for some new toys or games, let them choose from what they really want. In this selection process he/she might do mistakes, which is common. But remember they are learning and these small mistakes are necessary so be patient and help them make a right choice.
Open a savings account in your child’s name. Deposit small amounts every month or the cash gifts which kids get occasionally, birthdays! Show them if they save more they will get the reward for their good habit. This gradually helps them understand concept of interest or reward for patience. Help them understand that patience is always rewarding.
Teaching kids about money is a learning experience for both parent and the kid. It’s not only about learning value of money, but also to become more responsible with money.
Hope you will get benefitted with these simple suggestions.
See you later!