Teaching Kids About Money
It may seem fruitless to teach small children how money works, but that could not be further from the truth. Helping children to understand the value and purpose of money can lead to a lifetime of sound financial decision-making. However, finance can be a bit of a tough sell to a 5-year-old. Keeping it interesting is an essential aspect of teaching kids anything and finance is no different!
Money is power!
When a person of any age has power, they are forced to make decisions. A great way to start teaching a kid about the workings of money is to give them some. Do not hand a toddler wads of cash! Next time you are at the store give your child the money and let them experience the payment process. Familiarizing a child with the point-of-sale situation is a great introduction to how money works.
Create practice scenarios at home
Millions of people are stuck at home right now and eventually, we will all have to ask ourselves if we used our time at home wisely. One great activity that helps kids understand basic financial and economic principles is creating a fake business!
- Ask the child to create a fake product to sell;
- Give them a budget;
- Use grocery ads or the internet to search for prices with them;
- Show them how a month of sales would play out based on the set prices.
This is fun for kids and adults. It is never to early to instill entrepreneurial spirit!
Include the kids in money conversations
Let’s be honest, sometimes talking about finances can be stressful. Those tense conversations should not be had with kids. However, there are plenty of opportunities to include little ones in money conversations. Some great ways to do this include:
- Letting them help you pay the bills;
- Showing them the budget;
- Talking to them about current money news; and
- Sharing and explaining financial vocabulary.
Money should be earned!
People everywhere are restless at home these days. Kids are not immune to the feeling of being cramped. Challenge the kids to find ways to help and earn money. Having an allowance can be a good thing if the kids are earning it. The money-making endeavors they choose should be above and beyond their normal chores. It is important that they learn that you have to perform a job function to earn money, not just do the day to day chores they would have to do anyway.
One of the hardest things to do in life is to save money. Kids will naturally want to spend the money they have. Saving money takes maturity. When your kids earn money, you should encourage them to save a portion of it. This teaches them that they can enjoy the money they earned and save at the same time. Keep their saved money in a clear container so they can see it grow. When enough money is saved, take them to open a savings account!
Even the most skilled savers and earners can run into financial trouble. If you or a loved one are feeling the stress of debt, you have options. The attorneys at Dsouza and Strachan Law Group have the knowledge and experience to get you back on track. Contact Dsouza and Strachan today for a free consultation.