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How to
Teach Your Kids To Save Money
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by: Matthew Bezaher |
It is never too early
to introduce your children to money. They need to know the proper way
to receive, spend, and save money. Start today and teach your kids the
value of a dollar.
Parents need to agree on how to
handle the issue of money in the household. Kids learn from watching
their parents. If there are money issues in the home, include the
children in the discussions for learning purposes. If you are fighting
constantly about debt, we recommend that you get credit counseling or
financial help so you won’t pass the issues onto your children.
There
are several ways that kids may receive money. On birthdays and holidays
like Christmas, money is given as a gift. Teach your child that money
is valued by always helping them to write and send “thank you” cards
for every gift of money received – or make a “thank you” phone call.
This will not only teach that a gift of money is to be appreciated, it
also teaches respect.
As kids get older, parents may
opt for an allowance. The exact age when an allowance should be given
is up to the individual parent, of course. Parents may enforce rules
pertaining to how the allowance is spent, or issue it as “fun money”.
Become
discerning about purchases made for children. If they don’t need a new
toy or you can’t afford it, explain this to them. There is no endless
fountain of money—they must learn to save in order to buy.
When
a child is old enough to understand that money is needed to purchase
items from the store, you are safe to teach them about saving money.
Children that are learning how to count money in school will find it
fascinating to count real money at home. Take the time to show your
kids each monetary unit, coins and bills.
The next
step is to explain how to accumulate money. Ask your kids what they
would buy if they could. Ask your child how much money they currently
have. Your child should be old enough to add and subtract so that they
can do the math to find out how much money they still need to be able
to purchase the item.
As parents, we need to stick
to our guns. Don’t give in and supplement your child’s earned money
with your own so that they can buy their item of choice. Providing a
cushion sends the wrong message.
Teach your children
how to manage money as soon as they are able to understand the concept.
Learning to save will establish a healthy respect for money in your
child’s mind.
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