Introducing kids to money and finances
All parents want their kids to have a carefree childhood, they do not want their kids to grow up with the worry of finances because there is “plenty of time till they grow up” or, “they will learn when they become mature”. A survey shows that 2/3rds of parents are reluctant to talk to kids about money. Taking the reins at an early age and explaining to them the importance of money and how crucial it is in their lives is very important. With the wide range of unfiltered opinions on the internet, they can get lost in the crowd of advice so it is better to guide them from an early age. Here are some tips to what you can talk about with your kids when it comes to finances.
Starting off with the basics
Answer your children’s queries about money depending on their age. Being honest with them and letting them know gently works wonders. Involve them, indulge them in your financial planning. They need not know all the details but include them in your small wins.
The concept matters more than figures
You do not need to disclose figures when you have to explain the simple concepts of finance like living on a budget and paying off debts. They need to understand the importance of these things so that they realise no matter how big or small the amount is, these concepts are universally true. When they are old enough, encourage them to earn. Being financially independent is good and actually helps them be set for their future. It inculcates a sense of responsibility and helps them throughout life.
Teach them the value of money
As important as it is to teach children about money and the facts about it, the ethical side of money must also be discussed. Encourage them to work hard in life and not take shortcuts to prevent the ethical dilemma of cheating. Reward them for their performance, show them that the joy of working hard to achieve something makes the fruits of it infinitely more sweeter than the short cuts they can take. Similarly, talk to them about the power of giving too. Encourage them to give to the needy, do charity and share what they have. Teach them gratitude for what they have and help those who don’t.
Savings is a must
Although the concept of savings has already been introduced above, teaching our youngest generation to save is the biggest task of them all. Only earning and being spendthrift is not an advisable example to set for your kids. Introduce the concept of savings through a piggy bank. For example, if they want to buy an expensive toy, make them save up for it, or at least a part of it. Help them set up a savings account when they are old enough, they will thank you later.
All in all, talk to kids about money. Be their guide to a more financially responsible life.