How to teach children about money

How to teach children about money

A recent survey conducted in the UK found that 94% of parents rated educating their children about money as extremely important, however, 50% 'sometimes' discuss it, and 25% never discuss it.

Our friends over at Money Under 30 have some great ideas about how to teach our kids about money.

1 Make it casual

“The key to teaching young kids about money is to make them realize that everything has a cost,” he said. “Every time we go to a restaurant or grab an ice cream, we make sure the kids know how much everything costs and compare that amount against what they have in their bank accounts.”

2 Be a good example

We know children learn most from their parents' behaviours and actions. Talk about money in front of them, let them see your decision making up close when it comes to spending money and how you determine the value of a product or service.

"Kids won’t always listen to what you have to say, but they’ll definitely see what you do—even if you don’t think they’re paying attention. If they see you speed through traffic or coast through a red light, they’ll assume it’s ok. Personal finance is the same."

3 Learn by doing - Let them try it out

“Letting your kids learn how money works for themselves is a powerful tool,” says Ron Lieber, New York Times columnist and author of “The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money.”

He says parents can do this by giving kids an allowance to practice money management. An allowance lets them test the principles you’re trying to instil before they go out in the real world.

“Money is a tool for learning like any other, and an allowance is how we regularize the teaching,” he said. “Most households that are lucky enough to have more money than average don’t overthink the number of other tools for learning that they supply regularly, like books, art supplies and musical instruments. These are all things we want kids to get good at, to be patient with and persevere on. So why should money be any different, as long as they are using it responsibly?”
Bradley Ellison
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