Best tips to raise responsible children
No doubts, parents should have some degree of discipline about money, certainly their kids follow them. Experts says "Kids are great imitators" so the best and most effective way to teach kids are, being a role model to them.
Another saying is, "action speaks louder than words". So act yourself first and kids follow.
At the end of this article, I will share some beautiful resources parents can use.
This article focusing to children aged between 3 to 12 years, the best time to teach about money.
Present them a piggy bank and give coins regularly to deposit. Later, they can have a great time counting coins and dropping each one in their very own piggy bank.
Whatever allowance system you subscribe to, it's a good idea to include opportunities to earn additional money as well. For example, a surprise bonus rewarding a good attitude, a job well done or special effort being made is a powerful motivator.
If your child can read, make a list of the chores with their matching reward amount. If your child is younger, draw pictures or cut them from a magazine and draw circles to represent the coins they will get for each task.
Having an understanding will prevent bargaining and allow both parents to handle the situation in the same way.
Teach the good practice of convince themselves that buying something they don't need on sale is saving.
The art of spending is defining what you need, recognizing the pleasure of buying something very special and then looking for the exact item that fits the bill.
Only when kids want something beyond their financial means can you explain why saving money is a good idea. Teach them to always put 10% of their money aside.
At a young age, they will not understand what 10% is but tell them it is a tiny piggy bank in the piggy bank of money you keep there for emergency. This is the money you keep for something big or special that you want later.
Tell them to put 1 out of every 10 coins in the tiny piggy bank. Saving is a good lesson in waiting, something that is hard for young kids, because their perception of time is not fully formed.
As the child's earnings grow, they will learn not only math skills, but life skills as well. They will learn the value of money; that money is earned through hard work and daily effort.
Some parents may opt to exchange the play money earned for actual money later down the road.
For our children, they often asked us to buy something each time we went to the store. The "job duty" project has minimized their requests because the responsibility now falls upon their shoulders. The money they earn is used to purchase something they want.
On some occasions, our children will get to the store only to see something different than what we went to the store to purchase. Usually this new found item costs more money than what has been saved. At this point, our children need to decide if they will buy what they planned or if they will return home empty handed so they can save more money to purchase the more expensive item. What a great life lesson to be learned!
1. A Bargain for Frances by Russell Hoban - A class story work and one of the excellent additions to a preschoolers library! Best for kids aged 6+. A good read for setting goals!
2. A chair for My Mother by Vera B Williams - This classic and award-winning picture book best to teach kids about setting goals and earning.
3. But I've Used All My Pocket Change by Lauren Child. This is a best guide to teach about making decisions and wise spending
4. Just Shopping with Mom by Mercer Mayer - This would teach kids about prioritizing things and wise spending
5. Those Shoes by Maribeth Boelts - A beautiful book for kids to teach about prioritizing, sharing and borrowing
6. The Purse by Kathy Caple - A little book to teach kids about Setting Goals and Solving Problems
Another saying is, "action speaks louder than words". So act yourself first and kids follow.
At the end of this article, I will share some beautiful resources parents can use.
This article focusing to children aged between 3 to 12 years, the best time to teach about money.
Start Talking About Money with Kids.
Start from the age of 3, is ideal for this. Begin teaching the first principal of wise money management by counting coins. Let the kids start learns about money by holding coins, counting coins and recognizing the differences between each one.Present them a piggy bank and give coins regularly to deposit. Later, they can have a great time counting coins and dropping each one in their very own piggy bank.
Teach Kids about How money is Used
Discuss with the kid about the expenses you have and them the bills. This is the best time to explain to your kid why you can't always buy the toys he/she wanted.Give Children an Opportunities to Earn
Kids love to have little jingle in their pocket. That's the purpose of allowance. Allowances can be tied to chores or as some parents prefer, allowances are considered to be a base salary.Whatever allowance system you subscribe to, it's a good idea to include opportunities to earn additional money as well. For example, a surprise bonus rewarding a good attitude, a job well done or special effort being made is a powerful motivator.
Teach Kids about Income and Expense
When you choose to give pocket money as a reward, remember that the rules must be understood by everyone involved. Kids must understand how much you give and for what.If your child can read, make a list of the chores with their matching reward amount. If your child is younger, draw pictures or cut them from a magazine and draw circles to represent the coins they will get for each task.
Having an understanding will prevent bargaining and allow both parents to handle the situation in the same way.
Teach Children about the Art of Spending
Deciding how much and how to spend the money and on what is definitely an art worth practicing.Teach the good practice of convince themselves that buying something they don't need on sale is saving.
The art of spending is defining what you need, recognizing the pleasure of buying something very special and then looking for the exact item that fits the bill.
Teach from Borrowing
The first time your young kids ask you for a loan, be happy, because now you can teach them about savings.Only when kids want something beyond their financial means can you explain why saving money is a good idea. Teach them to always put 10% of their money aside.
At a young age, they will not understand what 10% is but tell them it is a tiny piggy bank in the piggy bank of money you keep there for emergency. This is the money you keep for something big or special that you want later.
Tell them to put 1 out of every 10 coins in the tiny piggy bank. Saving is a good lesson in waiting, something that is hard for young kids, because their perception of time is not fully formed.
As the child's earnings grow, they will learn not only math skills, but life skills as well. They will learn the value of money; that money is earned through hard work and daily effort.
Some parents may opt to exchange the play money earned for actual money later down the road.
For our children, they often asked us to buy something each time we went to the store. The "job duty" project has minimized their requests because the responsibility now falls upon their shoulders. The money they earn is used to purchase something they want.
On some occasions, our children will get to the store only to see something different than what we went to the store to purchase. Usually this new found item costs more money than what has been saved. At this point, our children need to decide if they will buy what they planned or if they will return home empty handed so they can save more money to purchase the more expensive item. What a great life lesson to be learned!
Best Finance Books for Kids
Here are some best resources that can be used by parents to teach their kids about money and money management. These are the must have books in a preschoolers library!1. A Bargain for Frances by Russell Hoban - A class story work and one of the excellent additions to a preschoolers library! Best for kids aged 6+. A good read for setting goals!
2. A chair for My Mother by Vera B Williams - This classic and award-winning picture book best to teach kids about setting goals and earning.
3. But I've Used All My Pocket Change by Lauren Child. This is a best guide to teach about making decisions and wise spending
4. Just Shopping with Mom by Mercer Mayer - This would teach kids about prioritizing things and wise spending
5. Those Shoes by Maribeth Boelts - A beautiful book for kids to teach about prioritizing, sharing and borrowing
6. The Purse by Kathy Caple - A little book to teach kids about Setting Goals and Solving Problems
Top 20 Tips to Raise Financially Savvy Kids: Plant the Seeds of Smart Money Habits Early!
Building a Strong Foundation
- Start Early (Preschool Age): Incorporate age-appropriate activities. Use jars for saving, spending, and sharing to introduce money concepts.
- Talk Openly About Money: Don't shy away from money discussions. Explain how you earn money and the value of responsible spending.
- Make Earning a Learning Experience: Offer age-appropriate chores or tasks to earn an allowance, linking effort with rewards.
- Set Spending Goals & Limits: Work together to set achievable saving goals for desired items. Teach them to differentiate between needs and wants.
- Involve Kids in Budgeting (Age 7+): Let them participate in creating a simple family budget, understanding how money is allocated.
Activities & Games for Learning
- Play Educational Money Games: Board games like Monopoly Junior or Payday can teach budgeting and decision-making in a fun way.
- Practice Comparison Shopping: Compare prices at different stores or online for everyday items. Explain how to find the best value.
- Let Them Manage Their Allowance: Allow them to make budgeting decisions with their allowance, experiencing the consequences of choices.
- Encourage Saving Challenges: Create challenges to save for specific goals, fostering delayed gratification and goal-setting skills.
- Role-Play Real-Life Scenarios: Practice responsible credit card use or car buying scenarios with pretend play.
Guiding Values & Habits
- Lead by Example: Demonstrate responsible spending habits and financial planning in your own life.
- Teach Delayed Gratification: Explain the concept of waiting for bigger rewards by saving instead of instant gratification.
- Emphasize the Value of Earning: Help them understand that money doesn't magically appear, effort is required to earn it.
- Discuss Wants vs. Needs: Differentiate between essential needs and fleeting desires.
- Open a Savings Account (Age 8+): Take them to a bank to open a kid's savings account, fostering a sense of ownership and the power of saving.
Building Financial Knowledge
- Introduce Age-Appropriate Financial Topics: Discuss topics like interest rates, investing basics, or the importance of credit scores as they mature.
- Encourage Research & Discussion: Motivate them to research investment options or career paths, fostering financial literacy.
- Explain the Importance of Giving Back: Incorporate charitable giving into their financial plans, nurturing a sense of responsibility.
- Discuss Financial Risks & Debt: Talk about responsible credit card use and the dangers of excessive debt.
- Celebrate Milestones & Progress: Recognize achievements like reaching savings goals, reinforcing positive financial habits.
Remember, raising financially savvy kids is a journey, not a destination. Be patient, consistent, and celebrate their progress!
