Week 16: Teaching Children About Money
MONEY SMART CHALLENGE
Money Smart Weekly Conversation Fact: Most parents want their children to have the knowledge, skills and confidence to make responsible financial decisions.
No one is born knowing how to manage money, so learning good habits early on sets us up for success. Children can learn how to save and keep their money safe; what influences their spending choices; the difference between needs and wants; the importance of goal setting; and effective personal strategies for making responsible spending and saving decisions.
10 Tips on Teaching Your Children to be Money Smart
Examine your own values and behaviors related to money. Remember that children learn a lot about how to handle money by listening to and watching their parents. Set a good example by making responsible financial decisions – and don’t be afraid to admit if you are struggling with your money management. Now’s a great time to learn together!
Give your child an allowance and let them make their own spending choices with it. As soon as your child understands that people use money to buy things they want, give them a small weekly allowance. Raise the amount each birthday to keep it in line with your child’s reasonable personal spending needs. Encourage them to plan purchases in advance. Giving them an allowance helps you balance your budget too, but only give them as much as you can afford. A guideline is $0.50 – $1.00 / year of age of your child.
Expect your child to help with family chores. Helping around the house is part of being a family. Give allowance strictly for learning how to manage money. It’s better for you child to make small “mistakes” now than bigger mistakes later on.
Provide extra income opportunities. Occasionally, offer your child an opportunity to make a small amount of extra income by doing an extra chore. Help them decide what to do with the extra money they earn.
Teach your child to save regularly. Set up a process for saving money in a piggy bank or bank account. Regularly monitor how much has been saved, and talk to your child about goals for using their money.
Help your child discover the satisfaction of sharing. Encourage your child to identify ways they can spend money on helping others.
Show your child how to be a wise consumer. Before your child buys something, review alternative ways of spending the money to emphasize the necessity of making choices. Teach them to comparison shop for prices and quality. Discuss how advertisers persuade people to buy their products, and encourage your kids to be savvy about commercials.
Teach your child a healthy attitude towards credit. When your child is old enough to understand what credit is, consider allowing them to borrow a small amount of extra money from you to make a major purchase. Negotiate how much your child will repay each week from their weekly allowance, and then be very careful about collecting the money and keeping track of the remaining balance each week until the debt is repaid.
Teach your child the value of wise investments. When your child is old enough to understand interest rates and rate of return, play an investment game to learn about alternative investment strategies and financial risks. Websites can be very helpful.
Involve your child in family financial planning. Let your child see you planning your budget, paying bills, shopping carefully, and planning major expenditures and vacations. Explain the affordable choices, and allow kids to participate in the family’s decision making process. Set a family goal that everyone can work towards.
Taken from http://www.mymoneycoach.ca/money-management/kids-money
START the MONEY SMART CHALLENGE TODAY by ANSWERING this QUESTION:
Money Smart Week 16 Question: What is the first step you plan to take to start teaching your children to be Money Smart?
Now, What Do I do?
Email your answer to the Money Smart Week 16 Question and your full name and mailing address to firstname.lastname@example.org Your name will automatically be entered into a draw for a Samsung Galaxy Tablet. (a $300 Value!)
You can enter your name once each week for a total of 17 chances to win! Answer the question anytime before the end of the Challenge on May 28, 2017 and your name will be entered into the draw for a Samsung Tablet.
So, If you missed answering any of the questions for the previous week, go to those weeks and answer the question(s) now.
(NOTE! Only residents of City of Camrose and Camrose County are eligible for the draw for the Samsung Galaxy Tablet.)