Raising financially responsible children
LEARNING to save and to master the art of delayed gratification are keys to wealth building; and the sooner you learn, the better you will be at it.
Here are some tips for raising financially responsible children:
Let them earn their own money
Whether it is in the form of a regular allowance or pocket money, reward your child for chores done around the house. Learning to appreciate the link between effort and reward is important because there is no “free lunch” in the real world.
Give them savings jars
Or better still, get your child to make her own savings jars by recycling glass bottles or plastic containers and labelling them Save, Spend and Give. Discuss and agree on what proportion of their allowance will be spent on each. These three aspects form the foundation of responsible money management.
Have healthy money conversations
The way you speak about money will impact your child’s future relationship with money, so be sure to phrase every conversation positively. “Money doesn’t grow on trees” is patronising and does little to explain where money does come from. Speak positively about money as a tool that can be used for good.
Teach them where money comes from
Explain to them where the family’s money comes from and how you earn it. Help them understand that you are able to use your special skill to make money, and this money is used to provide for the family.
Take them grocery shopping
Take your child grocery shopping so that they can see you in the act of comparing prices, making decisions and handing over your cash. Talk to them openly about how much things cost and why you have decided not to buy certain things.
Create a timeline
If you are saving for a particular goal, for instance, a new couch, draw a timeline with your child so that they can visualise the distance between now and when you buy the couch. This will help their mind make the connection between time and money.
Read to your child
Find children’s stories about money and keep them interesting. Avoid too many “rags to riches” stories which reinforce the idea that anyone can “win it big”. Seek out well-written children’s stories with meaningful lessons about money, hard work, saving, being smart and giving to others who are less fortunate.