4:01 pm - Tuesday September 29, 8043

Ideas to Encourage Your Children to Manage Money Smartly

It is easy to send your children to school, teach different games, and help them in their science projects. However, inculcating in them the habit of saving money or managing money smartly is relatively difficult. Sadly, skills to manage money are not taught in every school.

Therefore, if you as a responsible parent start teaching your kids some simple skills to save money, they will become more responsible, sensible, and confident enough to overcome the bad temptations in today’s consumer market.

These temptations are invoked by the different ads and banners that continuously incline them to spend on unnecessary items such as cold drinks, fast foods, and expensive but trendy accessories.

Children to Manage Money Smartly

However, ad-induced temptation and peer pressure’s bad effects can be effectively tackled with the right education and knowledge. These two are more powerful in changing the way of thinking as well as patterns of behavior.

The dual-fold benefit of imparting money management education is that even you will get to know about some tips and tricks that can save your money in the near future.

Here are some financial ideas for your children to save money.

Set Up a Way to Make Money

The first thing that you need to teach your child is that money never comes FREE of COST. In order to do so, a great idea is to set up a stipend or pocket money system wherein they can take the fixed sum from you only after doing something for it.

You can delegate some apt job responsibilities that need to be fulfilled for earning the pocket money. Like if your kid is a teenager and is good in PowerPoint you can hire them part-time to manage your business-related Power Point PPT.

This way they will not only help you out but also learn some money managing and business skills as well.

Alternatively, instead of taking pocket money from you, encourage them to get some bonus money from you when they successfully earn on their own by doing small things such as working at the supermarket and babysitting.

Set Up a Budget

It is a good idea to aid your kids in establishing a budget. Learning how to make a budget certainly turns out to be one of the most vital aids in the future when they will be spending on their own. What is important here is that you need to teach them by setting goals and keeping them in mind.

The goal should be such that your kid is encouraged to set up a savings plan before buying any ‘wanted’ item, not the ‘needed’ one. This will help them to get rid of “I want it right now” attitude, which will obviously need patience and constant efforts.

Setting up a budget actually teaches your children about prudent money management at such a youthful age. Now, when your kids get money, they can determine how much of it can be spent and how much can be turned into savings.

Make Small Investments

Savings at a very young age are really wise but channelizing them for doubling them is best. Therefore, you need to teach your child the importance of making investments.

One such investment to consider is the savings account. You can open such an account in a bank, in the name of your child and educate her or him about the interest that will be credited to the account. In this way, your child will learn about the significance of investing some money every month.

Deal Smartly with Their Blunders

A secret to making your child learn is to allow her or him to slip. So, if she or he spends all the earnings on a useless purchase and then asks money from you, simply do not shout or scold but tell her or him that you do not have money at all.

Do so for the sake of giving her or him a lesson in the form of a learning opportunity. Children need to recognize the consequences of unnecessary or careless spending decisions.

Filed in: Investing Saving

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