Finance for Kids
Studies show that the 10 years after leaving school are ‘make or break’ time in terms of finance for kids – in this time we either set ourselves up for the future or spiral into debt resulting from unchecked spending on credit cards and unwarranted purchases.
And this is made worse by marketing companies deliberately targeting our vulnerable youth, in the hopes that they haven’t learnt about controlling their spending yet and that they will just buy their products on the spur of the moment.
No one wants to see their children spiral into debt, but by teaching your kids how to manage their money responsibly, you help them set themselves up for life! And it’s never too late or too early to start teaching your children about money.
So here are some things you can do to teach finance for kids.
- Lead by example – it’s pretty hard to teach finance for kids when you’re struggling yourself. Get on top of your own finances [read the “Financial Goals” tab on the NavBar for more information] and use this success to show your children how it’s done.
The skills you need as an adult to manage your finances are the skills you should be teaching your children too!
- Use pocket money (or an allowance) as a learning tool. Pay them for doing household chorse and for their part in keeping the family running.
And help them plan what they are going to do with it – spend some, save some? Set financial goals with your kids.
- Help them open a bank account for saving their money and teach them how to prioritise their spending – must have, should have, nice to have.
- If your children are tweens or teens, no doubt they will be interested in mobile phones and cash cards. Use this as an opportunity to discuss the dangers of cash cards and credit cards in particular, explaining that debit cards and pre-paid mobile phone plans are a lot safer, as they won’t let you spend what you don’t have.
And make sure they are made responsible for all expenditure on mobile phone plans and cash cards!
- If they show an interest in known ‘scams’ or dubious ventures like mobile ring tone subscription services, explain to them how they work and read the fine print with them.
What ever you decide to do though, it needs to fit in with your household budget and teach your children real values at the same time.
Check out the tools in the ToolBOX under the section on “Goal Setting Forms for Kids” – you’ll find a budget sheet and saving thermometer to help your children set and achieve their finance for kids goals.
Also check out this great site teaching finance for kids.
Do you have a pocket-money story or some advice that could help kids get financial? Write a page on it and help kids get ahead…