Early teaching plays a significant role in shaping our child’s personalities and lives. As crucial as teaching children manners is teaching them the ability to manage finances.
Here are a few ideas that would help teach kids about money management through simple activities. These concepts are not specific to any particular age group.
- Story time: – Share with your children about your early years. The difference in the economy back then and today. Drawing examples from personal life will help them better understand the meaning of inflation. It could be as simple as cost of an ice cream 20 years back and compare it with today’s prices.
- Savings: – you can open a bank account on your child’s behalf, take your child along and explain how it works and why it’s necessary. This will spark their interest because it’s something new and exciting. When they turn ten, kids can begin handling their accounts with as little as 100 rupees.
- Wallet: – Give your child a wallet, some allowance, and a notebook. Ask your child to record all of their spending in the book and encourage them to save money as well; at the end of the month, based on how much they have saved, they will receive a reward. As they gain a sense of independence, this activity will teach them responsibility.
- Value of money: – Present your child with one of each coin and bill. Practice going over the sizes, and values, and have them do simple math if they are old enough to do those calculations. Teaching your child the value of money from a young age will help them become financially aware later on in life.
- Promote Entrepreneurship: Starting an income is the most critical foundation for any financial awareness in future. Ask your child to find ways to earn money. Let your allowance be linked as rewards giving them a sense of income generation.
- Shopping: – Explain to younger kids how you make money so you can buy things. Talk about the factors that influence your purchasing decisions, such as the difference between expensive and inexpensive items, wants, and needs. Pay using cash so that your child can observe money in action. To help them remember what you talk about, play shop together.
- Teach older children how to compare prices, calculate unit costs, and use coupons and other special deals to save money. Even impulsive purchases! Discuss the differences between branded products and generic products, such as how stores place well-known (and hence more expensive) items on the easiest-to-reach shelves while cheaper brands are displayed above or below.
- Independent Spending: – Take them shopping, give them some money, and instruct them to buy maximum number of products with that money. This will motivate people to make decisions on permutations and combinations.
- Donate: – Teach your children the value of giving. Start by giving shelters your used clothing or food, and then teach your children about giving some of their saved-up cash. Assure children that there is no such thing as a big or small donation, and when a child donates any size, congratulate them and inspire them to make more!
Today’s kids are incredibly intelligent! At an early age they can learn things just by observing. Always, include your kids in little financial discussions so they feel important and will want to do more and save more!