Are you missing these five opportunities to teach good money habits to your children?
Are you teaching your children good money habits? Discover five opportunities to instil good financial practice you can’t afford to miss.
We’re careful to teach our children good habits that will ensure they’re polite and thoughtful to others, and take good care of themselves. But what about financial literacy?
It’s easy to assume that children naturally pick up good money habits by observing our own behaviour. But in fact there are key moments in childhood that we can use as a conscious opportunities to instil good habits – and set them up for life.
Five opportunities to teach good money habits
So what are these moments? Here are five golden opportunities to put your children on the path of good financial practice.
1) Before they start counting
Financial success generally depends on your ability to resist owning everything you see. So when your children start insisting you buy EVERY toy they happen to cast their eye on, teach them to think hard about what they want.
Even if you can buy everything they point at, the goal is to be able to go shopping without them forcing you to buy anything unless necessary.
It’s futile to talk about your limited money at this time because they won’t understand the concept. Instead, it’s important to teach them the concept that you don’t just buy everything you want, right now.
2) Once they start receiving money
There will come a time when family and friends start giving your children cash gifts on birthdays, Christmas and other special occasions.
This is a golden opportunity to teach them about saving money, and how it can benefit them in the future (for example, buying their favourite book or an item of clothing they desperately want.
Whether you opt for the piggy bank, cash jar or an actual bank deposit, your children will have a sense of pride knowing that they have set aside savings for their future. You can also pass on your own favourite budgeting tips to help boost their savings further.
3) When they have accumulated savings
Once children start seeing an impressive amount of money accumulating in their bank account or money box, it’s tempting to spend it on every trivial item they want at a whim.
So make sure you help them to think carefully about what they spend their money on, and encourage them to keep it for items that really matter to them. You can also teach them about setting financial goals, and how to make plans to save for their coveted big-ticket items.
4) When they want more money
If they’re saving up for something expensive, children will quickly realise that they need more cash sources than waiting for their birthday money.
However, if you keep on giving them cash they will fail to see the value of money because they can easily get it without effort.
So make sure you introduce to them the concept of working for something in return, to let them appreciate the value of hard work. It will also ensure they value their purchases much more, knowing how hard they worked to acquire them.
5) When they start going to senior school
By the time children start senior school, they should have learned a few money-saving habits from you. And one way to test how they apply their learning in real life, is by giving them regular pocket money that they can spend at or after school.
You don’t have to closely monitor their activities or constantly annoy them by asking what they did with the money. Instead, give them the freedom to do whatever they want with their allowance, but limit how much you give them weekly or monthly.
Hopefully, you’ll be surprised with how much your children have saved from their allowance alone after a few months or so. You could also be proud with how your children are choosing the right products when they’re making purchases.
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