One critical area of concern to me amongst youths is Financial Management. It’s our responsibility to see that their needs are met (food, shelter, and clothing) but in addition to the necessities, today’s kids need their own money. However, to just write out cheque’s or “dole it out” deprives them of a tool they’ll use through their whole life, the skill to manage their money effectively.
I found this article on a website with regards to Money management for kids and I have summarized the contents bellow.
- Money games like Cashflow, Payday and Monopoly Junior are fun tools that help teens understand money.
- Initiate money management lessons the first time he or she gets money. For instance, when they receive a large monetary birthday gift (or a bunch of small ones), don’t keep it for them! Ask them what they’d like to purchase with their loot and help them to choose wisely. Encourage your child to save all or a part of gift money for special, more expensive purchases.
- Provide your child with a place to keep his/her money (your pocket is not an option!). A couple of good money carriers for teens are neck pouches, a wallet or purse.
- Start a savings account for your teen and help them track deposits, interest, and withdrawals. An account with a debit (ATM) card will be a good choice, for monitoring purposes it should be interlinked with the parents account to ensure proper oversight abilities.
- Take your child to the bank on a regular basis deposit part of their cash at hand into a savings account.
- Go halfsies. When your child wants an expensive item, you’ll teach him a lesson in value as well on how to save when you offer to pay half the purchase price. This will help them feel a part of the purchase and therefore help with the manner in which they maintain or treat the item.
- Go over sale flyers and discuss value versus price with your kids. Help them understand when a bargain is a bargain and when it isn’t. Teach them what discounts are and when to take them or not.
- Let kids help make the grocery list and let them cross off items as you add them to your cart. Grocery shopping is also a good time to help kids learn to compare prices.
- An allowance is nearly a necessity for kids today, but make at least a part of it earned income. Cover your kids’ necessities with a fixed income and have a jobs list for them to earn extra money by doing extra chores.
- Remember your child’s money belongs to your child (that does not mean you can have it to do your own things!). Be supportive with advice, and encourage children to spend and save wisely, but allow your children to make final monetary decisions and pay the resulting consequences or reap the rewards of good money management.
Some parents feel they earn so much money and there for shield their children from the realities of money management, it’s a misconception because those kids have to be taught to earn money just as you learnt it. it’s inevitably going to come back and bite them, your kids don’t have to learn these things at work or on the street, the best time to inculcate these ideas is at a time when their brains are still malleable and that time is between the ages of 3-18yrs.
The original article can be found here – http://www.moneymanagementtips.com/kids.htm