The best gift is free, so teach your kids the value of money
After all, financial rearing can never start too early and can leave a long-lasting legacy of good financial habits.
With New Year just around the corner, some parents may have decided to teach their young ones some new responsibilities.
As parents, it is important to teach the children all the skills there are to know, and one of them is the art of understanding money.
Parents love their kids and most would, if they could, buy them the world. In today’s economic climate, however, buying for the kids is often just not possible and can lead to trolley tantrums. Parents trying to hush their screaming children are a common sight while shopping and may lead others to think that the child is spoilt.
Most often however, this is not the case. Children are children after all, and most lack a fundamental understanding of money. This leaves anxious parents, eager to bring calm to a screaming child in a shopping aisle, often giving in to the child, just as long as it means fewer dirty looks from fellow shoppers, and an afternoon of peace.
Kirsten Reynolds-Wood, Brand and Marketing Executive at GetBucks, understands this and has offered some valuable tips to help parents teach their kids the value of money. After all, financial rearing can never start too early and can leave a long-lasting legacy of good financial habits.
1. Teach the idea of ‘value’ and have fun doing it.
Helping young children understand that certain things require money to have and thus have value, is a vital step in the financial rearing process. If children are very young, use games to help them learn. Be creative and have some fun: Give them a purse containing a few coins and let them take it along to the shops. If they would like to buy something, count their coins with them and tell them whether they have enough to get what they want. If they do not, give them the option of something cheaper, so that they learn that some things require more coins and others less.
2. Teach the idea of ‘earning’. Rewards can help.
The simplest of chores should earn young children more coins for their purse. Picking up after themselves, doing kind things or even finishing their vegetables should earn them a coin or two. In so doing, children learn that doing good earns coins – and that coins themselves can be spent on rewards. Rewarding kids with coins and then allowing them to choose their own rewards with those coins is a fun way to teach them the bridge between earning, money, and the value of things. It is a simple concept that requires some effort but once it is learnt, it is invaluable knowledge for a financially stable future.
3. Teach the idea of ‘want’ versus ‘need’. Help them choose.
As children begin to grow up, and the idea of money cements itself, help them consider the items they buy with their coins, depending on their age. As always, speak honestly about money. Have conversations about their choices and help them choose things that are wiser to own. For example, a metal toy car might be a better choice than a plastic one because it lasts longer. Similarly, stress that their pocket money is for things that they want and that you, their parents, will buy them what they need. That way they will begin to understand the difference between a ‘need’ and a ‘want’, and how wise money choices can lead to better results.
4. Teach the idea of ‘saving’. There is no better lesson to learn.
All of the above neatly leads to the final piece of the puzzle. Teaching kids to save for a better or more expensive item is one of the most important financial lessons they can learn. A child who willingly rejects the choice of instant gratification for a better item they can buy after saving for a while, is a child well on its way to becoming a fully-functional financial adult. As such, always encourage the idea of saving, but don’t force it. Always give them the option with a thoughtful smile, to help them think for themselves. For example, you can have this now – but if you wait and save, you can buy that instead.
Children are complex little creatures and parents are brave to tackle all that complexity. The value of money, however, should be made simple to address and understand. As a parent, it is acknowledged that you always try to do your best to empower your kids to be financially smart and turning those trolley tantrum-throwers into budget-savvy kids is the best life-long gift you can give your child – and it’s free.
Do you perhaps have more information pertaining to this story? Email us at krugersdorpnews@caxton.co.za or phone us on 011 955 1130.
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