Posted on August 18, 2019 at 6:09 AM
One of the most important things you can teach your child is how to handle money. Of course, you can learn it on your own skin, either through a home loan taken out over power or through an irresponsible guarantee, but you better help him avoid these pitfalls. And you don’t have to start your education when you leave the university gate as a graduate student, but at a very young age.
Words about real life and thus money
You will learn many important things at school, such as the construction of the whipworm and the minerals of the Urals, but you will not hear any meaningful words about real life and thus money. Therefore, it is your responsibility to prepare your children for life in the financial realm. (Where there is financial education in schools, however, according to a survey, it does more harm than good. By the way, it is the job of the school to provide the curriculum and everything else to prepare for life, even if so many people forget it. whether your child will succeed in life is your responsibility, not your school.)
There are plenty of opportunities every day to talk about money, work, costs, livelihood for your child. You only have one thing to do: take advantage of these opportunities. When you take money, when you shop, when you pay the bill, and so on.
I have already written about the subject here and here, now I want to continue this. What I have written there, I do not want to repeat if you have not read these writings.
Things cost money and make money
Even at the age of four, it is worth teaching them that things cost money and make money. Tell them you are working to have money and write down what you are doing. Already at this age, you can explain the difference between what you need and what you want. It is also worth mentioning that there are things you have to wait for what you get. Very good Sesame Street video on the subject (here) but unfortunately I only found it in English. Watching such tales is a great opportunity to talk about what you have seen.
Things to watch out for: Never tell your child that we can’t afford it or that we have no money. It is important for the child to feel financially secure and not to understand that you need to be deprived of your money. Instead, tell us that we don’t want to spend money on this or that we won’t spend our money on this. Older children may already understand that there is something they are not good for, but don’t burden a 4-5 year old.
For bigger kids (6-9 years old), talk about advertising how they want to influence you to buy something you don’t need. There are some who teach the child to mute the TV when it comes to advertising.
Your savings can be categorized by such a child by the Spend-Save-Invest-Sell-Sell split, which teaches you what to put aside for everything and why. This is a great piggy bank that I wrote about many years ago. A good split is 40% spending, 40% short term collection, 10% long term collection and 10% donation.
(Of course, there’s no need to say that kid’s money is taboo; there’s no way you get stuck and you lose your child’s money. If you’re able to steal so much, you certainly need to learn a lot about managing your money.)
Seven-nine-year-olds have a great game here that teaches you how to spell words and understand the value of coins.
At this age, you need to decide before spending your money, look around and compare prices and products, because once you spend it, you will lose your money forever.
You can show this old kid what his family spends every month. Some people have done it so plastic that they picked up all of their salary in $ 1, took it home, dumped it on the kitchen table, and showed their kids what they would spend. He calculated the utility, made it a heap, the refueling money became another heap, the lunch money, the monthly home insurance, the shopping money, the tithe and all the other items became a heap. This way, your children could see visually what they were spending and how much they were spending per month. With this idea, you have succeeded in raising the children’s awareness and understanding of how money is distributed from month to month.
In the early teens, it’s worthwhile to get you to put away one-tenth of your money. Before the age of 18, teach him the dangers of indebtedness, paying particular attention to credit cards and the fact that you do not even have to buy a car, especially a loan, from getting a license.
Most common financial issues between children and parents
Spending is one of the most common financial issues between children and parents. Children are asking for more and more. So be careful when you always buy her the chocolate and the little things in the store. He will soon be asking for much more expensive things and it will be natural for him to always buy everything for him at his first request.
It’s best to give your kids pocket money and make it clear that they need to buy the coveted things out of it. (Give the little ones weekly pocket money, the bigger ones every two weeks, the teenagers once a month. A good starting point is that you give $ 200 to $ 500 a week as many years as your child is. TV, ice cream, whatever.)
Be firm and consistent. Make it clear what you pay for and what you do not get in your pocket money. This way, there will be no question of what is unnecessary to ask for, which you have to manage from your pocket money. Once you’ve got enough pocket money, buy a recharge card, or even a phone or coveted sneaker.
Never lend to your children. Learn the consequences of beating their pocket money and understanding that there are things they need to collect, not getting it right when they need it.
If your child gets money, encourage them not to spend it right away, but think about where their money is best.
Teach the child to take responsibility as well. If, for example, you left your bike uninhabited on the street and stolen, don’t buy another one. Collect the cost of your new bike with your own money, and you will be better off looking after the next one. (However, if you locked your bike and it was stolen, you’re a victim of a crime. Then you comfort and buy another one.)
Never take your kid with you for shopping (shopping), or learn that shopping can be a pastime. (What can I say, don’t go on such tours, it will only end up being a meaningless expense.)
If you know, take the bigger kid to the bank and tell them what you do and why. It’s a good idea to pay your savings account with them and tell them how much you are doing here and why.
Experts recommend that you pay with cash in the presence of children under the age of ten, not with a magic card that will never run out of money. They understand the loss and handover of cash, and the card only confuses them. It’s something you can always buy. At this age, the card is still too abstract for them to understand.
Talk to your kids regularly about money and material issues, so it is natural for them to make money and finance an integral part of their lives that they should always care about and talk about.
Never underestimate the importance of money to your child
Never underestimate the importance of money to your child, just to avoid having to answer a question, Rather, teach that one of the most important elements of a successful life is money and attitude.
Your child will often find that his or her other child is walking around with an iPhone and shopping for branded stuff. At this point, it is very important that you explain to him why you are not buying these overpriced suckers and notice that the value of a person is not determined by the gadgets and other gadgets he owns.
Once again, it is very important that you do not say that you do not lose such things because you do not have the money, because then you will understand that these status symbols really represent wealth and prosperity, which is not at all true . (You’ve read my article on Millionaires, haven’t you?) He’ll live up to the thrill of seeing 250,000 phones and 15 million cars.
Another bad thing you can do is buy them these pockets on the principle of less resistance so that you don’t hang out with other consortium’s financially ignorant contemporaries who are fascinated by advertised products. This way, you are successful in educating yourself to live your entire life based on your wishes and the distorted judgment of society. Well, don’t be surprised if you don’t even look at many credits at the age of 30.