Teach Your Kids these 10 Money Lessons
31-10-2016
  1. Money Doesn't Grow on Trees
When kids see notes pop out of the ATM, they don't realize that money is a finite resource. Explain that you work to make money, and the bank is just a place that keeps your hard earned money safe.
  1. Work with Your Budget
The best way to teach kids to start managing money is to give them some. If they blow their pocket money on a toy and don't have enough left for a DVD they really want, then that's actually a good thing, then they learn firsthand the consequence of overspending
  1. Good Things Come to Those Who Wait
Teaching kids delayed gratification will help combat the "buy now, pay later" mentality that could mire them in credit card debt later on. So, as much as you can, reinforce the idea that waiting pays off. For instance, make a homemade cake together with all the ingredients your child loves; then show them the difference in taste between a store-bought one. The homemade cake takes longer, but it tastes way better.
  1. Don't Spend It as Soon as You Get It
Curbing impulse buying goes hand in hand with teaching delayed gratification. Show by example. Before you go shopping, create a budget. Outline what you're going to buy, what stores you're going to, and the price range for each item. Then compare prices online. Consider letting your child keep the savings so she sees that bargain-hunting pays. They will learn that planning purchases before you buy is the routine.
  1. Saving Is Cool
Your child wants a new toy that he/she doesn't have enough money for? Tell them to save up! Once they have enough, take them shopping and let your child pay the cashier themselves. They'll never forget how good it feels to work toward a goal and be rewarded in the end.
  1. Keep Track
Simply knowing where their money is going is a big step forward in your child's money management skills. Have them use a notebook or go on a computer to keep track of their money. Make a file or use an old bag, where they can store their receipts and statements.
  1. Have a Wish List
It's hard for kids to set priorities, so sit down together and make a wish list of the things your child wants to do with their money. Then help them rank the list by discussing what's important about each wish.
  1. Make the Most of Savings
Introduce your child to savings vehicles that could earn them interest, such as children’s savings accounts. Search for a compound interest calculator online and show them how just Rs.1000 can grow with interest over time. They'll be amazed!
  1. Be a Little Skeptical
While you don't want your children to think companies are out to get them, every now and then point out manufacturers' sales tricks. Healthy skepticism is crucial not only so kids can resist the allure of products on TV, but also because it helps keep them from buying into the messages behind the advertisements, like if you have the right clothes and toys, you'll be popular.
  1. Share
Have your kids donate a portion of their pocket money to charity. It teaches them that money can be used to help people, rather than just for buying things. Remind them that not everybody is blessed with what they have and they should count their blessings and show gratitude by giving back. It’s important to stress that it's not how much you give and that every little bit counts.