The attitude that you have about money will inevitably affect your children’s views on it. Just try this simple experiment – take your children to the store, show them something that they want but is way too expensive to purchase, and observe their attitudes on it when denying purchasing that specific thing. Are they mad? Are they uncomfortable? Do they understand why overspending on trivialities is a bad thing? If they do, then you’ve already done an amazing job at shaping your children’s attitude on the money. If they don’t, you still have to make some changes.
Children must understand the basic foundation of how money works. They should also have basic knowledge of economic issues and political policies that might affect the flow of money within a population. They should learn how to think strategically since day one. Therefore, they should not be taught that money should be spent when whimsical impulses pop up. Children should receive real education about money and be raised to develop significant attitudes toward it. So, if you’re still trying to help your children figure this out, here’s a short guide on how to do it.
The best way to learn something new is by experiencing it first-hand. If your child is never allowed to touch money or handle it, they will never learn the real pros and cons of spending valuable resources and allocating funds to specific causes. To get your child used to use money wisely, you must help them develop personal attitudes toward it; and the best way to do it is by giving them the ability to practice personal finance.
First, have a conversation with your children on the practices that they should engage in. Then, set an example that they can follow. If you have no idea how to handle your finances, they won’t either. You can talk as much as you want about the “right ways to develop strategical attitudes” if you won’t practice what you preach. Then give them money and help them map out a plan.
The next thing you must do is help them figure out a plan that works. They could use their allowance for this. Teach them how to manage their money and not get frustrated when it becomes scarce. Teach them how to spend money. Teach them about impulse control and how to govern their finances according to certain principles. They should learn about instant and delay gratification. They should learn about their goals.
Create essential teachable moments that you can later use as examples. Create scenarios that they must figure out. Help them structure their expenses according to their needs. Help them understand why savings are important. If you can, link their allowance to house duties or other jobs that they can perform. Teaching your children that money comes with personal responsibility and effort is important. Otherwise, they might get old and develop the idea that working for money is inappropriate – that they should instead receive it; and I’m sure you don’t want to teach them that.
Also, teach them that charity is important and that helping people is an essential part of being a good person. Teach them generosity and love towards others both by financial and personal means. Teach them that sharing is caring and egotistical thinking will bring about fewer benefits than they might think.
“Money can seem abstract to young minds, so making it less abstract is crucial,” argues professional writer service representative, Jay Tulsan. “So, you could help them visualize it or represent it through concrete things that they understand. You could use a piggy bank as an example of their savings and teach them that the piggy bank represents their pension,” ends Jay.
You could choose different objects from the house and offer them intrinsic value; then, ask them which ones they would invest in. It might still be quite abstract, but they’ll understand it. You could also offer them a realistic idea of how much you make and how you’re dividing your money if that’s what you prefer. Whatever works for you and your child!
What are credit cards? What are the debit cards? What is a pension fund? What is Apple Pay? What is Venmo? These are all questions that your children might have. It is helpful to teach children about the modern use of money and available financial tools from an early age. This will help facilitate conversation between them and other children who might also have this knowledge. It can also make them ask more questions and be more interested in learning new financial concepts and transactions.
If you find your child interested in one specific thing, use that to your advantage. For example, if your son is passionate about video games, have him structure his allowance in such a way that he would be able to purchase a new video game every two months. Ask him about his goals, first of all, and then, map out a plan according to his wants. Teach him that saving up money (and thus avoid spending it relentlessly) will bring him joy in the future when he will see his new game delivered. Make it about them and their passions so that they understand the power of money and more importantly, the power of saving it.
It’s okay to allow your children to make mistakes – in the end, what better way to learn than this? If they screw up, they’ll learn faster, because it’s their mistakes. Let’s say your kid wants to make a stupid purchase that he or she might regret later. Maybe it’s an expensive video game or something else that they really want. Let them do it. And later, when they want to spend that money on something else, tell them “Sorry, you already spent all the money that you had on that one thing.” This will make them understand that spending everything they have on something they desire at the moment is not a good idea; they’ll learn to be careful about it.
Last but not least, remember that your child is still a child. While it’s essential that they learn important financial lessons and the consequences of impulsive spending, they should not suffer because of it. It’s okay to protect your child from constant disappointment and take away the full responsibility of being an adult – they’ll have time to feel that later. Don’t create fear around this problem but rather replace that with knowledge. If you see that they never learn, try explaining it better, and keep explaining it until they get it!
Teaching your children positive and cautious attitudes toward money is an important milestone in their education. Make sure they know how to make a budget, how to spend money carefully, and how to avoid impulsive shopping. Good luck!
Author Bio: Alice Jones is a custom essay papers writer and journalist. She is from San Francisco, CA. She graduated from the University of San Francisco and got a Master’s degree. While an assignment writing service specialist, Alice concentrated on such topics as business, marketing, and freelance.