HOW SHOULD KIDS UTILIZE MONEY IN A RIGHT WAY

money management for kids

WHAT IS THE RIGHT AGE TO TEACH YOUR KIDS?

There is no right age to teach anything, but it’s okay if you start early, if kids get to know about the proper utilization of money they will be able to apply it better at the later stage of their life.

In the book Rich Dad, Poor Dad by Robert T. Kiyosaki and the two children got to learn the basics of money at a minimum age.

Nowadays, most of the adults struggle in handling finance and end up wasting their hard-earned money every month and regret it later. So it is imperative to get into financial conversations with your children and teach them about the importance of money handling.

HOW TO TEACH IMPORTANCE OF MONEY TO KIDS?

Being a parent is a tough task but can be fun and fruitful if you do it the right way so here we have compiled a few ideas of teaching your kids the right and easy way-

INSPIRE KIDS TO EARN MONEY

Assigning your kids to do chores for extra cash or reward is a great way to start teaching them the concept of money. It can be anything: washing clothes, cars, dishes, cleaning the house, or completing any work for a reasonable amount of money could help them learn that money can be earned.

And not just money they can learn many other things though these tasks- how to do household chores, management, and entrepreneurship is a bonus which they can learn and apply at an early stage.

Having an entrepreneurship mindset from an early age would help them to think differently and to think of ways of earning money.

ASK THEM TO READ BOOKS AND WATCH VIDEOS

A lot can be learned when you surround yourself with the right mindset of people, and in today’s era of technology, everything is just one click away. Surround them with books and video from where they can learn more about the utilization of money.

GOAL SETTING

Take a small step and give them a reason to earn money, spend it, and save it wisely. Start by getting into a conversation with them about why they want to make money; this can give fuel to their thought process. Goal setting is essential, studies suggest that people who set goals are more successful.

Help them to set specific and realistic goals that can be achieved.

TEACH THEM WAYS TO SPEND SMARTER AND WISELY

There are many ways of doing this. For instance, children are not aware of the price of the things they are demanding, but won’t it be good if they know the worth of stuff?

They might be surprised to know that the prices of items can drop if they wait for some time. Informing them about sales, brands, and using coupon codes can teach them the worth of money and spending them wisely.

You can ask your kids to keep a record of their spending and evaluate what things were important and what they want to change.

Ask them to calculate the number of hours they have to work for the amount of money they require for purchasing something they demand and ask if it’s worth it?

TEACHING THE FUNDAMENTALS OF SAVING

 Children usually may want to spend the money they got the next second into useless things, but giving them the idea of saving the money and the advantages of it can help them in learning the importance of saving money.

Ask them to make a goal for example-save for a toy they want, ask them to keep a record of the amount of money saved so that they can know the progress they are making towards their goal.

INCULCATE GIVING BACK HABITS

There are numerous ways in which you can teach them about money and why it’s essential to give back to people around them. Donating old clothes, helping older citizens, and donating toys they no longer want is some of how they can help people and ask them to give a small amount of money to charitable organizations. These habits will teach generosity and kindness to them.

DEVELOP PRACTICAL SKILL AND TELL THEM ITS VALUE

No one wants their child to do household chores. But it is crucial to keep in mind that when they start to live on their own, they may find it very hard to manage the household work and then they will spend their money on laundry, food, etc.

They might not want to do the chores now but will thank you letter for teaching them the tips, tricks, and shortcuts in doing household chores.

BASIC INVESTING

It’s never too late to learn about investing. Introduce them to passive investing i.e., spending some amount in a few things and not buying or selling it very frequently, and this basic investing can be exceptional learning before they start to learn more. Give them books to learn about the basic principle of investing. The book “The Little Red Hen” would be an excellent start for your child.

CREDIT CONCEPT

Using a credit card is not wrong, but giving them proper knowledge about it would help them in getting into debt. And credit cards can also help them in keeping track of their expenses and earning rewards.

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