How to deal with money while you grow up will give one a better shot at a trouble free economic life as adults. Ensure your kids know how to deal with Money as they grow.
Kids usually learn by observing you in daily life. For this reason, you should always share the problem that you face daily about what is going on in the household and discuss that problem openly and maturely in front of kids when appropriate. Educate them in every financial concept as you do.
As they grow older, they are directly introduced to complex aspects of economics, from savings and earning to budgeting and investments. They should be assign a daily project just have a knowledge of doing so rather exposing them when they grow. They must be involved when you’re grocery shopping or handling some money in banks – to understand what it means. If this approach is regularly followed as part of growing, you can instil a responsible and wise sense of economy to your children before they handle serious quantities later.
As their first words are copied from your lips, kid’s financial habits are learnt from your pocket.
1. Maintain Envelopes for Long term and Short term goals.
2. Give them a habit to ‘Set a Goal’ by sketching it or sticking cut outs of what they want.
3. Help them in calculate how much they can save weekly to reach their goals. Keep a realistic time frame so that they don’t frustrate.
EARNINGS (Age 5 – 8)
Money we get for working or providing services:
1. Offer them some money when they do some task.
2. Let they do some dish washing in exchange of money.
3. Add this EARNED money in jar so that they can see how they grow.
1. Take them on weekly food shop and give some amount to spend on some food items from the list.
2. Discuss on expensive and cheaper brands and how to choose items within the budget.
3. Ask them to spend the money on item they get from the list wisely.
1. Give them a choices to buy any product, say for example give them a X amount and ask them to buy any 3 items.
2. Ask them to choose any 3 items because they cannot afford all.
3. Explain to make financial decision based on money we have.
Budgeting (Age 11 – 13)
It is nothing but allocating your money, how your money will be used.
1. Give them a task to decide how much to spend, say for a Holiday planning.
2. Let them decide how much they need to spend per person.
3. It helps to decide how they can make decisions around choosing the items within the budget.
INVESTMENT (Age 13 – 15)
Investments are something that you put your money into to potential gain more money in the future.
1. Explain how paying for College or University can help them in future return.
2. Show how earning differ from profession to professions.
3. Share various investments options which you do.