So many adults battle with handling finances and budgeting. Learning how to properly plan and manage money at a young age is so beneficial. It saves a lot of trouble in adulthood and also helps our children build a better future for themselves, hopefully with little financial strain.
As a parent, you want to make sure that your children will be looked after financially when you aren’t around, whether they are young or well into adulthood. There is only so much we can leave behind, but the most important tool we can give them is teaching them how to handle money.
Kids are incredible at taking in lessons from different situations, and you can start helping them implement some healthy money habits from young. They will hopefully practice these habits later on in life without even realizing it.
- Teach them that every cent counts
It is important to teach your child the value of a dollar. Show them that every dollar has a purpose, whether it be buying a smaller item or saving for a bigger picture. When they receive money for their birthday or pocket money, help them plan how they will use each little bit of it. This will encourage budgeting and a sense of the worth of money. Without this, they will feel okay with spending money on a whim and being left with nothing. Even the smallest cent has a worth, and they need to understand this.
- Discourage impulse buying
Impulse buying is the quickest way to blow a budget. Kids are especially susceptible to this. They see a silly flashing toy in the store and immediately want to spend all their pocket money on it. Once the toy loses its pizzazz or breaks, your child is left with nothing. Try and help them understand that if they can do without it, or if it wasn’t planned, they should not buy it. Impulse buying is a habit that can easily be broken with a little bit of effort. A treat every now and then is fine, but this should also be factored into a budget. While your child does not need a full-blown monthly budget for the couple of dollars they have earned, giving them a sense of what is wasteful is enough. As long as they know what is meaningful spending, and what impulse buying is, they should be able to build on this ideal as they grow.
- Help them build a nest egg
Saving for the future is something that most of us battle with. It is more than difficult to tell a child to put all their money away for their retirement – it just isn’t going to work. Instead, get them into the habit of saving. Buy a piggy bank, or better yet build one together to make it more special. Get them to put a portion of their pocket money away each week or month, and choose something that they really want. Once they have saved enough money you can go with them to buy this item. This is a great way to teach them how to save, how to have the patience to save and that once you have spent your money it is gone and you’ll have to start all over again. Drill into their minds that from the day they start their first job, they should save what money they can, even if it be that lonely little dollar. They will thank themselves in the future.
Money management is a skill that is easily learned, and quite easily implemented from young. By giving your child these tools and lessons, you are instilling habits that will benefit their financial well-being long into the future, and hopefully, reduce some of the stresses of adulthood for them.