Our attitudes towards money are, to a great extent, shaped by our parents. And yet, according to a study, less than 50 % parents admit to teaching their kids about finance. Here are six great ways to help kids grow up with a healthy attitude towards money.
1. Practice what you preach. Children learn best by observing their parents. If your kids grow up seeing you save money, they are more likely to do the same later. Make it a point to explain to them how you take steps to save money and avoid wastage.
2. Give an allowance. Rather than giving kids the money they ask for, give them a fixed allowance. This will teach them to prioritize on how and where they spend “their” money. They will also have to decide between spending the money and saving it for future use.
3. Teach them the value of money. Once you have settled on an allowance ‘amount,’ don’t indulge them with liberal advances. If you must, charge them an interest—this way kids learn that everything good has a price.
4. Let them earn. One way of teaching your kids to value money is by letting them earn it. You can pay them to do chores such as washing the car, running errands, or raking the lawn. You could even make a deal whereby they clean out the attic, for instance, and keep the money earned by selling the unwanted stuff that comes out.
5. Encourage business skills. Encourage entrepreneurial skill in your kids by helping them find ways to raise money. For instance, they could easily earn good pocket money by running a lemonade and cookie stand, or running a dog walking service.
6. Open an account for them. Teach your kids wise saving habits by opening an account for them and teaching them how to use it. Allow them to withdraw the money under your supervision. Besides learning to use and monitor the account, this will also be a lesson in the importance of investment.