With the cost of living how it is at the moment, it’s the perfect time to teach the kids about budgeting and how to handle their money
Whether you want to start off with basic maths skills or you want to set up accounts and allow them to be in charge of their own pocket money, we’ve compiled ten ways that parents can start to introduce healthy money habits.
Set a good example
One of the main ways that children learn about the world is by following their parent’s lead, so setting a good example is a great way to teach them how to be responsible with their money. If they see you budget and saving for long term goals, they’ll be more likely to do the same.
Talk to them about money
We don’t mean that they need to know the ins and outs of the family’s finances but talking to them about how to manage money is important. Money is vital in our society, so talking to them openly about how much things cost is a good foundation to helping them learn how to manage their own money.
Encourage them to save
We all remember what it was like to get some money for your birthday or another occasion and being desperate to visit the nearest toy shop, but if you encourage them to keep some aside, it will help them understand how saving, and in turn things like pensions work which are important for the future.
Be clear about the difference between a need and a want
One of the biggest things we have to learn when it comes to money is the difference between needing something and wanting something and one way to successfully teach the kids about being financially responsible is to make sure they know the difference from an early age. Needs are items that we cannot live without, such as food and shelter, whereas wants are things we would like but are not essential. Understanding the difference is a great way to learn how to spend wisely.
Teach them about credit
Credit can be incredibly helpful, it can also lead people into financial trouble, especially if they are not careful or do not completely understand the credit terms. Starting to talk to your children early about credit, repayments and such like will help them later in life.