Teaching Kids About Money Early Makes Them Money Savvy

Teaching kids money and the art of handling it successfully is something that never occurs to most parents. Like most other life skills, it is vital that parents introduce kids to money as early as possible. Teaching kids about money at an early age helps them appreciate its value and equips them to handle it wisely as adults. These days when credit card debts bring down national economies parents have a responsibility to educate their children about the importance of money in our lives and the best way to handle it.

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Children understand money as something that gets them what they want. If at the same time they have no understanding about where it comes from, how it is earned, its value, and the need to handle it with respect they will grow into a pattern of spending binges and mindless shopping with no thought for tomorrow.

What Parents Can Do to Teach Kids about Money

Teaching kids about money comes naturally when you take them along when you go grocery shopping. Draw them in and include them when you check prices instead of letting them run amuck in the aisles. You might know exactly what you need to pick up. But you could pause and pick various brands, compare price and weight of each, and ask your child's help in deciding which would be a better deal and save you money, even if it's a few pennies. 

This involvement in something as routine as buying groceries helps them realize the value of the money that has to be paid so you can sit down to dinner. There's also the matter of quality and food ingredients which are topics for another day.

Teaching kids about the value of money is present in most every day activities. Show them your pay check and explain how you earned it by working hard. This will help them understand the need for hard work and the resultant feelings of accomplishment that hard work alone brings. 

Teach them to save and wait patiently to get something they really want instead of just going and getting it for them faster than a genie could. This tells them how money is something that needs to be valued and saved. It also shows them how to harness its immense power to get what you want.

There are times when what you desperately wanted a week ago loses its allure and you don't care that much about it anymore. So, waiting a while before spending on the latest gizmo might result in big savings eventually. This could also prove to be an important lesson for your child in how wishes and desires come and go and why it wouldn't be a wise move to give in to them impulsively. 

As your kids grow, their allowance grows too. This is when you need to insist on their saving a part of it if you haven't already. Here's your chance to steer them away from the lure of consumerism which is the scourge of modern life. They are also old enough to earn extra money doing chores around the house. 

Should Kids Get Paid for Chores? 

Tasks such as taking out the garbage or feeding the pet would not, in my book at least, be counted as coming under paid labour. But then it is up to each household to decide what works for them. If your child grows up expecting to be paid for every household chore, he or she might lose sight of family values and bonding. It's simply that there are some things in life you do without thought of being compensated for the simple reason that you are lucky enough to be part of it. Teaching kids about money should not make them mercenary; just money savvy. 

On the other hand, going above and beyond the call of duty should be considered as deserving compensation. This could mean watering the garden, weeding, washing the car, folding and putting away the laundry of his busy parents, or tutoring a younger sibling on a regule. If your child decides to do extra chores instead of lazing in front of the TV, she deserves to be appreciated for her enterprise.

When your kids graduate to part time jobs, they become acquainted with paying taxes, savings accounts, credit cards or even buying shares. You could add value to their experience with money by introducing them to charities and other philanthropic activities and encouraging them to donate at least a tiny percentage to these enterprises. Teaching your kids about money is not complete until you also bring to their awareness the other side of the coin.