Why You Should Teach Your Kids about Money
People get an opportunity to make decisions when they have money. The main reason why kids need to be taught about money is to provide them with suitable education regarding money, empowering them with capacity to make decisions and also to motivate them to become avid savers as well as investors. A good education imparted on kids, especially at an early age will provide them with the necessary skills, understanding and appreciation of saving and investing their money as well as spending it wisely when they have to. Wise parents will therefore embark on training their kids in matters of financial prudence as soon as the kids can count.
One of the first important steps is to help introduce the kids to money as soon as possible. Parents, guardians and even teachers should take an active role in providing kids with the necessary information that will enable them acquire the basics skills and knowledge regarding their finances. It is also a pretty good idea to allow children to observe and repeat what they learn. When kids learn positive practices early, they will rarely abandon them.
Kids also need to learn early about the values of money. This is best achieved by regular and quality communication regarding the value of money. Kids need to learn the purpose of money such as how to save, when to spend and how to invest. Wise spending of money is very important and kids need to learn this fact as early as possible. There are wants and there are needs. Kids need to understand the difference so they will have the capacity to decide between what to purchase, what to spend their money on and what needs to be avoided. Good spending decisions are key to success in terms of financial discipline.
There is a huge difference between savings and spending money. A clear distinction needs to be made to kids. Kids also need to be provided with their own pocket money in their pre-teens and encourage practicing good savings, spending and investing habits. This is absolutely key for success in good financial habits. Kids should learn to keep records of their financial investments or other expenditure so they can keep track of their finances. Such prudent training at an early age in life will ensure kids have a better understanding in regards to the use of money, the expenditure as well as the need to save and invest as often as possible.
Author Bio: Heather is a frugal mom who often likes to collect coupons and discount gift cards when she shops. She writes blogs on how to save money and financing, and loves to give useful tips to other frugal moms.