How To Teach Your Child About Money At Every Age
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In today’s day and age, although we’d like to think that money isn’t everything, money is at the source of everything. It is a medium through which you can live a comfortable life and can ensure your future success. This is why it is imperative to teach your child how to handle money at a young age. Unfortunately just giving them an allowance and asking them to be careful with the way they spend it doesn’t cut it anymore. If you want your child to grow to become a responsible and financially stable adult, you need to start teaching them about saving, what bank accounts are for and how they can use it to their advantage. This may seem like a tough lesson to teach your little ones. So we’ve come up with a couple of tips that you can use to help teach your child to manage money at every age. Read on to know more!
1. Age 2 to 3
So, it’s no secret that your little one is not going to be able to understand the value of money at this age. They barely know what it is or how it is used. Before making things complicated for them, it’s best to take a step back and go back to the basics. Introduce your child to money by teaching them the names of coins. You can play the game “identification” which entails your child checking different coins, examining their colors and shapes, and then matching them with the image while discussing the names.This will help with familiarizing them with money. But please be careful when your baby is playing with coins and make sure to never leave them unsupervised.
2. Age 4 To 5
One good way to introduce your child to spending money wisely is to do it with them in a safe space like the supermarket. Before you go grocery shopping you can clip a few coupons and ask your child to keep an eye out on a specific product you can use the coupon on. Make them feel like they are helping you and doing something important. You’ll never miss the carrots now!
Another way to get your preschooler to learn about money is to set up a fake restaurant at home. This is a good way to prepare your kid for future dinners in the real world and explain some basic things throughout the game such as manners and how to set the table. Remind your child that they will have to pay the bill at the end of the dinner with their pretend money.
3. Age 6 To 8
This is around the age where most parents start giving their kids an allowance. But more importantly this is the time when your child should learn where to place their money. You can give them a piggy bank or a colorful jar in order to get them excited about saving but a smarter plan would be to take your child to the bank and open an account with them. This way they see where their money is going and can get the hang of using a card with your permission and supervision from a young age. Kids who do this are less overwhelmed when they are older and have to do the banking process by themselves. Remember, you are preparing them for adulthood. A fun perk of this is being able to take them to the bank on a special occasion so they will be able to buy something they want for themselves by themselves.
4. Age 9 To 12
When your child is 9, they can start reading price labels with you in order to gauge if something is worth buying or not. This is when they start to compare price and quality and learn to pick items that are worth their coin. One way to do this is to try using a roll of toilet paper from one brand for a week and then switch to another brand and another price point the following week. Then discuss the differences between price and quality with your child and determine which toilet paper you should buy the following week.
5. Age 13 To 15
This is a good time to learn about the stock market. Now that your child knows how to save, they can learn how to invest: what to invest in and how to do it wisely. Before the venture into the real deal you can pretend to invest in companies that your child is familiar with like Apple or Coca-cola. Watch the financial news together once a week and explain a new term to them in simple terms. You can motivate them to invest by discussing the profit they can make but don’t forget to discuss the risks as well.
Teaching your child how to have a healthy relationship with money is tricky but it can be done. And if done well your child will never have a problem with budgeting in the future. So make sure you make the effort to teach your child how to be financially stable from a young age. Happy parenting!
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