13 Ways to Teach Children about the Value of Money
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Appreciating the importance of money begins at home like any of the traditional values that you know. Money can be a source of problems at a latter part of the lives of your children if you will not teach them how to value it. A lot of people have succumbed to debt traps and depend on cash advance loans because they originally thought that money will flow like a fountain. So, how are you going when it comes to teaching your children about the value of money?
When Do You Start?
This is probably the most asked question and the answer is as soon as your child knows how to count. You must participate with their learning from the beginning as repetition and learning from others are just two ways to teach them about the value of money.
Popular Methods on Teaching the Value of Money
There are several ideas that you can compile but here are the most popular ones.
- Teach them about accumulation or savings instead of consumption or spending. You have to tell and demonstrate the concept of savings. As they grow older, you can teach them the power of interest as the benefits of accumulating money.
- Tell them about the value of money as often as possible while you teach them the process of accumulating money.
- Slowly teach them the difference between needs and wants and of course their wishes. This will impart the idea of spending their money very wisely.
- It also helps when you teach them about goal setting when it comes to accruing money. This will help them be very careful on how their money is spent; like thinking twice before spending their extra allowance on toys and gadgets and save it later for their school projects instead.
- Give them small bills instead of large denominations when giving allowances. It will be easy for them to save if you give them five $1 bills instead of a whole $5 denomination.
- When they are a little bit mature, introduce them to other forms of savings such as investments like bonds, stocks, and mutual funds for example. Let their imagination go wild when you teach them the accumulated interest which bonds will earn after a period of time.
- Open a savings account for them. They should be present at the bank when the savings account is opened.
- Work with them so that putting money on their savings account will become a habit.
- Teach them about record keeping so they can track where their money went and how much cash on hand is left. This will be a prelude on teaching them about budgeting their money.
- Demonstrate the idea of saving food, clipping coupons, and price comparison. Remember that food items is one of the major spending of household and teaching kids these ideas will help save money for the family.
- Take them shopping and while doing so, teach them about the idea of planned spending. Instead of buying what their fingers are pointing at, tell them how they can buy it through their savings instead.
- Allow them to decide for their spending but you should guide them when weighing about the pros and cons on items they like to buy.
- Warn them about the evils of borrowing and the consequences of interest payments when they are mature enough to understand some adult things.