Help your children learn the value of money with these four tips.
A recent survey by the Money Advice Service found that 57% of parents identify themselves as the biggest influence on their child’s ability to manage money. However, the same study found that 58% of parents found it difficult to chat to their kids about money. With that in mind, here’s some advice on how teach your children about money.
Show me the money!
Of course, buying things with a credit card is incredibly convenient. But your child will find it very beneficial seeing actual money to see how it’s spent. Next time they want to buy a treat, take them to an ATM so they can then see you taking the money out. Not only will they become familiar with different amounts of money, but they will start to understand how banks store your money.
Shopping with your children
If you’re out shopping, why not let your children have a go at budgeting what you pay for? Give them a finite amount of money, and explain what needs to be bought. When they pick something too expensive, let them continue to pick items. When they go over budget, explain how they will need to pick something cheaper instead. This will help teach lessons of value and that there’s not a limitless amount of money.
Talking about money
Don’t be afraid to talk about money with your kids. They will wonder why you got to work and what earning money really means. Even explaining why bills are paid can be very helpful. It will help them more understand little things round the house that they wouldn’t realise cost money such as water and electricity.
Perhaps the best way for your children to learn about money management will be through pocket money. It can be a very small amount at first. Not only will they feel empowered by making decisions, but they will learn as they go. You may also consider giving part of the pocket money when they finish chores. This is great way of explaining how people need to work to earn money, plus it’ll be a help round the house!