The sooner children start to learn about money the better and us as parents have the most important influence on how children deal with money in adult life. Teaching children about money while they are young helps them manage their own finances as they get older. With the cost of living increasing, now is the perfect time to teach children about the importance of saving money effectively. There are lots of age appropriate ways to do this by keeping it simple and making it fun.
Start with the basics of money and finance.
The age of your children will influence how you introduce money to them. Getting children used to handling cash and coins is a fantastic place to start. Explain how money is used to purchase items and that it must first be earned before it can be spent.
Speak openly about small financial decisions.
Begin including your children in minor financial decisions such as picking brands and items to purchase when you are out shopping. As a result, your child will be able to understand your choices while also feeling in charge of certain financial decisions. If you ask older children to keep a running total of the products you buy while shopping, they can assist with budgeting. This will not only improve their maths skills but it will also help children grasp how minor goods may add up in price and that not everything is budget friendly.
Try simple games with younger children.
Creating simple money games such as counting pennies might help your child in understand the value of various currency amounts. Use a stack of 1p coins and have your child match the number of coins to the price of a higher value coin, such as a 10p or 50p coin.
Set a good example with your own finances.
There's no denying that children pick up money habits from their parents. Small actions such as checking the receipt after a shopping trip or putting money into savings can help youngsters create beneficial habits from a young age.
Use pocket money as an incentive for small tasks.
Using pocket money as an incentive to complete household chores benefits both you and your child by teaching them about the value of money and what it takes to obtain it. Making a simple plan with a specific amount of money for different jobs is an excellent method to help your youngster understand where money comes from.
Teach them that actions have consequences.
With utility bills on the rise there's never been a better moment to teach kids how to run a household. Reminding them to turn off lights, their television or video games after each use will not only save you money in the long run but will also teach them about bills and saving the environment. They will also learn about the importance of environmental preservation and sustainability. You may even go one step further and demonstrate how energy bills are computed by showing them what the numbers on your gas/electricity metres signify.
Use pocket money to teach children how to save.
In addition to teaching youngsters about the relationship between work and money, domestic chores and pocket money provide an excellent opportunity to demonstrate how to save. If your child has expressed an interest in a more expensive item, you could provide them with an old fashioned piggy bank into which they may 'deposit' their profits or you could design a chart for them to fill out in order to keep track of their finances.
Use trips to the shop to learn about saving vs. spending.
Visiting shops is another practical way to teach a child about the advantages of saving. Allow them complete authority over their finances with the understanding that once they run out of money they won't be able to borrow any more. They will be able to make more rational decisions about spending and saving if they feel in charge of their own money. Not long after Becky started a part time job she soon realised that at the end of the month she was running short of money because of her spending. I gently encouraged her to save and now she saves a good chunk of her wages. Phew!
Use digital tools with older children.
There are a variety of online tools available to teach older children about online banking and card payments. GoHenry is a popular product that allows parents to establish stringent spending limits, monitor what their children buy, and where they spend their money. It costs £2.99 per month and is suited for children aged six and up.
Teach older children about selling old toys for extra money.
If you don't want to offer your child pocket money teaching them about money making opportunities is a good option. You could ask your child to go through their old toys, books and clothes when they're old enough and set aside the ones they'd like to sell. You can then sell these on their behalf on sites like eBay or Facebook Marketplace. This is not only a terrific method for your child to feel self sufficient in earning money, but it also provides an opportunity to talk about how to use the internet safely.
How have you taught your children about money?
The I was sent an email from the website money.co.uk which influenced me to write this blog post.
