Tips

26/05/2011

In these days, teaching your children the value of money is essential

You're not born aware of its value. It's the kind of knowledge children obtain from their parents, from those close to them and from their own experience.

 

Financial education should begin at an early age. After they turn 3, it becomes possible to teach them various money related issues, after all, it's at that age that they begin asking for things.

It's useful for children to see their parents handling money. Whenever you go shopping, to the supermarket, to the hairdresser or to the mechanic, once in a while take your child with you and explain how when acquiring something you compare prices, features and their quality and only then make the final decision. Remember that children are very observant and that your reference is fundamental.

Since you only learn by doing it, let your children use the money, giving them small amounts so that, in time, they understand how money is traded for "things". So that they learn to use it wisely, understand the relative value of goods and make intelligent choices.

You could start giving them weekly allowances when they turn 3, and monthly ones after they're 10.

Giving an allowance is not an obligation for parents, nor is it a gift. It should be seen as a tool to financially educate your children. Parents should try to define what type of use the allowance will have, they shouldn't just give their children money and hope they spend it rationally.

Children begin by seeing money as simply something of value, yet as time goes on they'll learn to see it as a means to an end.

Explain as well how "family economy" works. It's important for them to realize the family is run on limited funds and that they must be managed properly.

Get your children to understand from the outset that part of that money will pay for food, the house they live in, expenses related to education and health, and amongst other things, to buy clothes. Your children should understand that these fixed expenses are prioritary, seeing as they're the setting stone for the family's well-being.

Explain to him how important it is not to ruin community property, not only out of respect but also because ruining it entails having to repair or replace it, that is, it piles up another expense for everyone.

Encourage them to save, make them understand how some perhaps "tedious" chores, such as cleaning the house or washing the car are a way to save money, which can then be used in a way that benefits everyone.

And, finally, avoid being over critical and be patient, after all your children are going through a learning process.

 

by Zippy