School is a very important time in any child’s life and will be just about the most transformative experience of their young lives.
While your kids will learn the basics of English, math and science during their school days, however, they probably won’t be taught about money management, which is a fundamental life skill that should never be overlooked.
The habits and knowledge children acquire about finances will follow them into adulthood, laying the foundation for their future financial stability. Teaching as early as possible is always a good idea for parents wishing the best for their offspring. But how do you ensur/e your little darlings have everything they need to navigate the complexities of the always evolving financial landscape?
Learning from the Ground Up
Children are keen observers by nature and tend to pick up habits and attitudes from their families and peers. So, why not extend that logic to the concept of money management? Families that discuss finances openly, practice responsible spending, and emphasise saving (for a rainy day) are more likely to instil these values in their children.
Initiatives like fixed-rate bonds provide excellent examples of saving responsibly and can be a great gateway for your kids when it comes to teaching them about the value of saving and how money can grow over time.
The Value of Money
How many times have you heard somebody question a celebrity about the price of a bottle of milk and they’ve been left dumbstruck? Understanding the value of money is a critical lesson for children and pampered stars alike.
It’s not just about how much money they have either, but understanding the work that goes into earning it and the choices they make on spending or saving it. By teaching children the value of money, you’ll hopefully be able to help them respect the work that went into earning it and it will help them build a strong work ethic in later life.
Saving and Spending Responsibly
One of the most valuable financial literacy lessons is teaching your kids to save and spend responsibly. Children should be encouraged to set aside a portion of their pocket money and birthday gifts for savings. Try introducing them to savings accounts designed for young savers to show them how their money can grow over time through interest.
Teaching children to spend responsibly also involves making informed choices and understanding the consequences of impulsive spending. It might be tough if you’ve always given your kids exactly what they want when they ask for it but the sooner you start helping them differentiate between wants and needs, the better.