Wednesday, 3 July 2019

Three personal finance lessons for kids

*collaborative post

Wise money management is essential and you’ll no doubt know this already. But, what about your kids, though? Do you want to introduce them to the world of finance and help them secure their assets for the future?

If so, you’re not alone. After all, it’s often better to start learning a skill early on to benefit from it properly later.

To make sure that your young ones achieve this, explore our top three lessons on personal finance for children under 10.

1)  Lead by example
Very often, we develop our understanding of the world through watching others.
That’s why it’s crucial to set a good example to our children in all areas of life, especially when it comes to finance. And luckily, you can advocate financial management to your kids easily.
Take the regular supermarket shop, for example. Take them with you, and you’ll be able to show them how to successfully search for bargains and offers.

Likewise, you could use this opportunity to explain how to stick to a budget while you buy goods

2) Introduce budgeting

Budgeting. It’s immensely useful — so, why not teach your kids this? True, it may sound like a complex concept to the very young; but it doesn’t have to be.
To underline the value of budgets, start with a simple method. Give your children a small amount of cash to last for a specific period of time. Make sure to illustrate that they won’t receive more once it’s been spent.
After you’ve done this a few times, they’ll learn that it’s important to plan spending in advance. And so, this is an effective way to introduce them to the idea of budgets.

3) Create cash flows

Why don’t you put theory into practice? Once your kids fully understand budgeting, invite them to create their own simple cash flow.

Because you’ll be giving them complete responsibility over their assets — however modest they may be – they’ll likely be drawn to the activity.

If you treat it as a creative project, you could increase its fun factor, too. Present your youngsters with their favourite stationery to create the document, to further enhance its appeal.
If they enjoy their first experience of drawing up a budget, they’ll be more inclined to build this skill in the future.

We all want our children to be safe and happy. If you encourage them to handle money wisely from an early age, they’ll be more likely to secure financial wellbeing later on in life. 

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