I am finally at a point in my life where I have a good basic understanding of managing my money, how can I help my children learn some of these lessons at a younger age?
It’s amazing how many people out there that lack a basic understanding of how to manage their finances. I really think that it should be a part of our normal education to learn about financial management, as it holds more everyday value to a person than say history or geography. I’m not trying to say those topics aren’t important, but personal finance is something that everyone will deal with in their lives. The key to improving the situation is learning ourselves, and teaching our children at a young age. That being said, there are many ways we can pass on simple money management lessons down to our kids.
For younger kids, try to use creative ways to get across the basic principles of money. For instance, we give our 5 year old a couple dollars here and there whenever he helps out around the house and takes care of his (few) responsibilities. Then we have him save up his money and plan to buy a toy or something he’s been wanting. It’s a great way to teach him that things cost money, and has the added benefit of making him appreciate his things a little more (since he paid for them). Not to mention he gets a lot of practice counting up what he’s earned, and he learns what it means to save his money for something he really wants.
For kids that are a little older you can set up a little something more formal. Many banks nowadays have accounts you can set up for your children. Since kids are so in tune with the internet as well, it can introduce them to online banking and being able to see their account balances. For teenagers you can take it a step further by getting them a debit card to go with their account. That way you can give them their allowance by just doing a funds transfer online and they can use their debit card to do whatever they need. This will introduce your kids used to budgeting their money (as their debit card has a definite limit), as well as getting them used to banking on the internet. With the explosion of mobile technology and now mobile banking, your kids would probably really take to those options and make the most out of what these mobile solutions have to offer.
These are just a couple examples of how you can help your kids learn some basic money principles at a young age, and help guide them into making smart financial decisions as adults. Take some time to come up with something creative and turn it into something new and fun to do with your kids. Chances are, they’ll be excited about it and it can be a win-win situation for everyone.
