Children who know the true value of money at a young age are a rare breed.
Just like the generations before them, a lot of parents these days still do not want to discuss money matters with their kids because finances are a concern for adults. It is no wonder millennials use the term “adulting” heavily when faced with financial responsibilities.
However, the growth of knowledge in the last 20 years has proven that learning certain lessons in life does not always need to come with age. At the same time, shielding children from harsh life realities such as an economic recession does not help in any way – especially considering how their quality of life is directly affected by it.
Therefore, if you are a parent, make it a top priority to develop future-oriented, money-smart children. This way, should something happen to your family’s finances, your children will not be helpless and, instead, work as your partners in keeping the family financially afloat as young as they are.
Here are four ways to go about instilling this sense of responsibility:
1. Teach your children that they are never too young to earn money.
It is not child abuse to encourage your children to work for money — as along as “working” does not subject them to compromising situations. Yes, a lemonade stand on your lawn remains a good way to earn extra money on weekends or holidays. Walking the neighbor’s dogs and pet-sitting count as well.
Along with this lesson, children should learn that they should work for what they want.
For this, the distinction between needs and wants should be clear. It is the parents’ responsibility to provide the needs and some wants if the budget permits. As for the things that the children say they just got to have (foolishly so, most of the time), they should be willing to work for them.
It will enlighten the young ones about how difficult it is to earn money to buy things, which is why parents prioritize necessities. It is important to point out that, more often than not, children who are taught this lesson early on grow up knowing how to manage their money better than young people who had never worked for anything.
2. Look into various income-generating opportunities for young children.
There are so many jobs for young children. You have modeling and acting as some of the high-paying ones. If your children are keen on joining the entertainment or fashion industry, encourage it. However, make sure that you set conditions to protect their best interests, including their education, and teach them how to use their income properly.
Such decent paying jobs are not all. If the little ones are really keen on earning an income, presently, there are different online opportunities for them as well. Kids these days now have monetized YouTube channels and blogs. Your children can give these a try.
Study all these provisions (and others) together to see which among them your children can use to earn an income from.
3. Instill frugal practices.
The reality that you do not always have to pay full price is an important lesson for children to learn. Teach your children (who can read, write and do math) the value of coupons, sales, discount codes, and using the rewards program for the family credit card. Not only that, teach them that the things they need do not always have to be brand new.
As young as your children may be, they can learn all of these things. And, if you explain frugality principles the right way, the little ones may implement frugality practices on their own without any second thoughts. This is because they completely understand that it pays well in the long run
4. Open a savings account for them.
Make it an important family affair to open a savings account for the little ones and teach them how to save as well as the joy of saving.
And when you head to the bank, request a banking representative to share banking advantages and the different services (such as online banking services) your young ones have access to purely because of their savings account.
Take a cue from a lot of Asian parents who not only discuss the importance of banking to their kids but also the value of investments. Your children can become really money-savvy and explore potential avenues for wealth growth.
Children who are exposed to investments have the tendency to zone in on becoming an employee as a steady source of income. But they also welcome a larger variety of options to financially secure their future.
Money-savvy children have an advantage in life. You do not have to worry much about them — not only do they understand the dynamics of money, they likewise know the right ways to earn money for their own benefit.