Money Matters: Important Money Lessons to Teach Your Children
Every parent wants a successful future for their children, but a surprising number of people never take the time to teach their sons and daughters about money – and how to use it wisely.
Well-managed personal finances are the cornerstone of wealth creation and managing pocket money well as a child is a huge stepping stone for later budgeting aptitudes. A balanced monthly budget which allows us to save and invest for the future is the first step to a comfortable life, and the habits that allow for this need to be formed in childhood.
Teaching your kids to be money savvy
There are a few key lessons that every parent should teach their child. We’ve summarised them here in five sentences:
- Always spend less than the pocket money you receive or the money that you earn
- Adopt an early habit of putting a certain percentage of your allowance each month into a saving account, before you start spending it
- There’s a big difference between really needing something and just wanting it
- You have to wait and save until you can afford something before you buy it
- Save and give to those in need before you spend on yourself
- Money is simply a way of making life easier for those you love – don’t forget your priorities
Financial responsibility begins with your child’s first allowance
Receiving an allowance is an exciting event for any child – and there’s no better time to teach your children about money management than in their young formative years.
By encouraging your children to save part of their allowance (and reserve a portion of it for giving to help less fortunate people), you’ll help them to establish healthy money habits for life. You can also reward them for saving with a small bonus amount – this will teach them about the concept of earning interest and give them an incentive to save.
Make sure that your actions match your words
Children learn the most by watching the adults around them. While wise words about money are helpful, your message is only as good as your own actions.
Telling your children to save their money while you spend more than you can afford to won’t achieve the desired result – you’ll have to live the financial values that you wish to instil in your son or daughter.
By teaching your children to budget, save, and shop around for the best deals, you’ll be setting them up for a successful future. If you would like to learn more about managing your personal finances and empower yourself and your family, contact us today for an in-depth consultation.
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