As parents, set an example. Be consistent about what you say and what you do.
Rocky Geba, an accounts clerk at a big Philippine bank, advises, “It is possible for children to save and invest money now because many banks have savings accounts for kids.” Check out your local banks for products designed specially for children.
Take your kids with you when you open their accounts, and let them see when their money earns interest. Paul Richard, executive director of the Institute of Consumer Financial education in San Diego, California, says, “Beginning the regular savings habit early is one of the keys to savings success.” He also cautions against parents’ refusal to allow their kids to withdraw money for a purchase. If the children feel they cannot use their own money for things important to them, they might be discouraged to save altogether.
According to Paul Richard, it’s good to set goals. A toy or a trip somewhere can become the object of a goal-setting session. It provides motivation and helps children become more responsible.
Shop talk Talk to your kids about money regularly and involve them in money-related activities where so they can learn about price comparison. Talk to them about your own goals and things you are doing to reach them. “Be honest about your own money mistakes, and figure out a way to let your kids learn from what you did (or didn’t do).”
Building Values For Life
Appreciation and gratitude
Money-smart children don’t only learn money-handling and saving skills, they also develop values needed in life. Anna Cabrera cites: “Money-wise kids are more appreciative of the fact that their parents have to work and be away from them for certain periods of time in the day just to earn money.”
When parents explain to their kids where money comes from and how it’s earned, they tend to be more considerate before making a purchase.
Money-smart children are also more responsible, not only with their money but also with most things like their possessions, chores, and schoolwork.
Saving also teaches them to have discipline. When a child learns to be frugal with money, he or she can also be naturally wise with the use of other resources.
Because money-smart kids understand the value of money, they are also able to develop compassion towards people who may not have enough.
A Decision For The Future
When you teach your kids to become money-smart today, you are making an important decision to help them all through their lives. A good money habit that is started in youth—saving at least a portion of money that one receives prepares a person to make good financial decisions in the future.