Parents are very busy teaching their children to mind their manners, do good in school, be good athletes, and try their best. There is a lot of focus on academics, sports and extracurricular activities. We keep our kids very busy. In the midst of the running around, do we forget to teach them the importance of good financial smarts? Do your children know how to handle money and their financial health? What will determine that your children grow up to live a financially sound life?
Financially sound does not mean wealthy. Supportpay is talking about being able to manage money wisely, stay out of debt, and feel in charge of your finances. This can happen at any level of income. The number one way that they learn this? You model it. So, if you are having trouble teaching your children about good financial habits, maybe starting with an examination of your own is in order. Work on displaying some healthy habits.
- Involve your kids in the household shopping. Help them know how you spend your money and make good choices.
- Don’t just shop for fun or buy things you don’t need for sport. This can lead to unhealthy habits and unrealistic expectations.
- Do not use your credit card all the time. Unlimited swiping doesn’t feel like spending money. Cash is real, tangible, and it is something the kids can understand. Teach them how to use cash only and they won’t spend more than they have.
- Take kids to the bank with you. Open them their own savings account when they are ready, usually between the ages of 10-12 is appropriate.
- If you choose to do an allowance, or anytime they receive money, teach the “Give, Spend, Save” mentality. Take a percentage toward each, and talk about how they want to give and spend it, as well as what they are saving for. Savings usually requires a goal to make it worthwhile.
- Don’t say “We can’t afford it.” Instead you could say, “We choose not to spend our money that way.” If you are always saying you can’t afford things, young children often begin to worry about money.
- Talk about money and finances casually with your children. That does not mean your personal financial status necessarily, but just make money conversations about everyday things a general norm. Discuss earning money, saving money, and paying for things so that money topics are not taboo or hard to talk about as they grow older.
It is important to teach our children at a young age to handle money, count money, and use money wisely. We can only talk the talk for so long. Eventually they have to see good money behavior modeled, and hopefully they will take note and it will guide them to a healthy financial future at any level.