Let’s face it—kids think money grows on trees. That’s because as parents, we often just buy our kids stuff. So they think all their belongings just come without hard work. However, if you don’t want to raise an adult with no handle on their finances… It’s important for you to teach kids the value of money. Whether your kid is 6 or 16, you can help to ensure they understand the value of a pound.
Teach Kids the Value of Money
Check out these seven ways to teach your kids the value of money and help them make smarter financial decisions as they get older.
1. Start a physical place to save.
Telling kids that saving money is optimal won’t be as beneficial for them as showing them how savings work. This is why starting a physical place to save is important. For instance, put a bowl or jar in your child’s room and have them put money into it, whether change or actual paper money. As your child watches the savings pot grow, they’ll start to understand how more money can be better in the long run.
2. Set a goal to help teach kids the value of money.
Kids will get bored just watching their money pile up in their savings account. So it’s a good idea to have them set a goal. Ask your child what they would like to buy (or have or do) and use that as your goal. It doesn’t matter if your child wants to save up for a candy bar or summer fashion programs for high school students, their goal is their goal. Once the goal is in place, tell your child what they will need to save in order to reach their goal.
Have them continue to save up until they have enough to make their goal come true. This will show your child just how much money can buy. It also show them how long it may take to save up for what they want. This is a brilliant way to teach kids the value of money.
3. Let them shop.
After they have reached their goal, take them to the store to buy what they want. Letting your child physically hand money to a cashier to get the item they want will let your child understand how money works. When your child watches their hard earned money leave their hands to get something else in return… They will start to understand the value of money.
4. Help them earn.
Whether you give your child an allowance or help them find a job in the neighborhood… You should do your part to help your child earn money. When your child works hard to gain money, and if they can learn that harder work pays better, it will make your child eager to work hard. Plus, it will also help your child understand that they will need to work for their earnings. So your child will not assume that anything is handed to them.
5. Teach your child how to give.
While you want to help your child understand how to save money, you also want your child to understand the importance of giving too. Teach your child that sometimes it’s important to give money without expecting something in return, especially if it’s going to something they care about. Ask your child if there’s a certain cause that’s important to them, such as helping animals or helping people in need. Then, let your child donate some of their money to a cause that supports that. This will show your child about donating and teach them about how to feel good for doing something good.
6. Say no to impulse buys.
If you are standing in line at the grocery store, you’ll be surrounded by impulse buys. Chances are your child will ask you for all of the items in their line of sight. But this is the best way to teach them to avoid impulse buys. Let them know that all of these impulse buys will eventually add up, and it will make it harder for your child to actually save for what they really want or need.
7. Set a good example.
The best thing you can do to help your child understand the value of money is to set a good example. If you tell your child not to engage in impulse buys, but then you’re always tossing magazines or candy bars on the belt at the grocery store, you’re not setting a good example. Instead, show them how to save money for a vacation or avoid impulse buys.
Teaching children about money isn’t going to be easy, but using these tips will certainly help.