Instilling good money habits starts as soon as children can count – after all, that’s what we all like to do with our coins! The lessons change as the children grow up, so read on and see if any of these ideas speak to you.
Use a see-through jar instead of a piggy bank
Most people’s first thought when they buy a savings pot for a small child is a cute piggy bank. These are great, of course, but there are no visual cues for the child as the amounts grow. Using a clear jar means that you can both see the money as it increases – yesterday there were six euro in there, now there’s six euro and fifty cents! It’s like magic – only it’s real!
Set the right example
Your children pick up their attitudes towards money from you, so if you’re slapdash and you’re always paying for things with your credit card, then they’ll think that’s OK. If you have bad money habits and you tend to overspend, then getting help from advisers like Credit Fix can break the cycle. Talk about money when you’re shopping and explain that spending all their pocket money at once means they can’t have treats later in the week. Try not to argue about money in front of the children, too, because it’ll make finances seem stressful rather than something they can learn to manage.
Give your children small jobs
This can be mowing the lawn, cleaning out the guinea pigs or washing the car, but having their own job with its own remit teaches kids that money is earned, not just doled out. It’s also good to give a small allowance as well, so that they learn to be giving and kind, though.
Make sure they’re giving
Children love to give money to charity as it makes them feel that they’re making a difference in the world. Your kids should be encouraged to donate a portion of their pocket money to their favourite charity – it doesn’t just make them feel good, it changes the lives of the recipients.
Teach them to be happy with what they have
This is probably one of the hardest lessons, especially for teens who are bombarded with glitzy images of wealth and success every day. Learning how to appreciate what they have – especially the non-material things – comes with practice and lots of talking. Watch the news together and talk about how fortunate you all are compared to some people in the world.
Open a bank account
You can open a bank account in your child’s name when they’re seven or eight. Hopefully, some of your earlier lessons will have sunk in and they’ll make regular deposits, no matter how small. They’ll also enjoy watching their savings grow through compound interest, which is an important lesson for managing bigger amounts, like salaries, when they’re adult.
Get them to make a simple budget
One of the great things about being surgically attached to a smartphone is that you can install a budgeting app for your older child to use. It doesn’t matter how small the amounts they’re working with are, they will learn to record everything they earn or receive so they can plan for future purchases.
Encourage them to earn money
Teens love earning their own money, so help them to find a job, be it babysitting, dog-walking or fruit-picking (for older teens). Earning their own money usually means they look after it more – and it also means you’re not the Bank of Mum so much!