When it comes to teaching children values and ideals, parents often forget an important thing i.e. to teach their child the value of money. Like anything else, it is very important to educate a child about the art of spending and saving money. Almost everything we do revolves around money and is based on the decisions we take. It is the everyday spending decisions that encourage a child to learn the technique of using money wisely. Apart from helping you teach him about decision-making as far as money is concerned, it would also ensure a secure financial future for your little one. In case you are wondering how to go about teaching the value of money to your child, the tips given below will come handy.
Ways To Teach Your Kids Value Of Money
- The first attempt towards teaching your child the value of money would be to introduce the child to money. Once your child reaches an age where he can count, let him/her start handling some money.
- Remember, your child will learn the value of money only by two ways - the first by observing you and the second by repeating what you do. Teach him how to save money, how to make it grow and how to spend it wisely.
- It is very important for children to differentiate between needs, wants and wishes, right from the tender age. This would help them learn the art of spending as well as saving.
- Reaching the set target or goal would help a child learn and grow as a responsible adult. Whenever you get a toy for your child, let him know its worth. At the same time, tell him that you would not get him another one until a few months.
- Teach your children the value of saving and the art of spending. Explain them how they can double their amount if they properly spend their money. For this, you can consider paying interest on money the child saves at home. This would surely make saving an interesting prospect for the child.
- As far as giving allowance is concerned, give your child change, instead of one large note. Ask him to save at least one note per week. Pay him/her the interest on a quarterly basis. This would help him realize the value of money and how he can grow it.
- Take your child to the bank and open an account for him, even if it is a joint account with you. This would make saving a regular habit for him.
- Once in a while, allow the child to withdraw more that the usual amount in case he/she wants to get something.
- Another very important thing would be to teach your child how to keep a record of the money spent or saved. Make sure he maintains an accounts book, wherein he writes the amount of money spent and saved.
- To demonstrate the value of money, take your child along whenever you go to a grocery store. This would teach him how to plan economical meals, avoid waste and use leftovers efficiently. Show him how to check for value, quality, reparability, warranty and other consumer concerns, in a product.
- Let the child make his own spending choices. This would help him learn better than if you always barge into his spending decisions.
- Advertisements are usually distressing as they infuse the craving for a product. Make sure you teach the child how to evaluate the products, so that he does not fall into the trap of the advertisers and ends up spending uselessly.
- Once you have established a base for the value of money, it is time to teach your child the danger of borrowing. Let him know that he needs to pay an interest on the money he borrows. If your child asks you for more pocket money, let him/her know that you would charge interest on the small loans you make to him. This would help your child learn quickly.
- Lastly, let your child actively participate in family discussions about finances. This would help increase his knowledge, enabling him to make wiser decisions.