Raising kids is a tough job, but someone’s got to do it. Raising kids who are smart about money is an even tougher job. Are you up for the challenge? These five tips on raising money smart kids will help you focus on raising kids who are smart about their money.
#1. Talk About Money
Don’t spend their whole child hood not talking about money. Kids need to hear their parents talking about money and solving their money problems. It’s important that your kids don’t grow up thinking you’re perfect with your cash because you’re not. Do not be afraid to talk about money in every light possible.
#2. How to Spend Money
Some parents don’t teach their kids how to spend money. When your child reaches adulthood and are faced with all of this “pressure” on how to spend their money, they may not spend it right. That’s why it’s important to talk to your kids about spending money. Let them spend their own money and make mistakes. It’s okay if you’re there to guide them, but let them make the majority of their decisions. Isn’t it better if the learn about money mistakes as a child (where it’s harmless), then as an adult? Adults have larger repercussions then children when it comes to spending money the right way.
#3. Balancing an Account
Spending money and not balancing an account is how the majority of Americans spend their cash. However, balancing an account is one of the best ways you can raise kids who are smart about their money. You can teach this lesson when children are little by having them write down everything they buy. You help them subtract it form the overall balance they had before they started spending. When it comes to money lessons and children, this should be on the top of the lesson list.
#4. Handling Money
Kids should know that not all money comes in the form of credit or debit. Your children should be able to touch and feel the cash they are about to spend. Most money experts would agree that cash hurts when you spend it, using a card doesn’t. Allow your kids the chance to handle the money they own. Also, let them pay with cash when they do make a purchase. This is something they really need to experience to understand.
#5. Money isn’t Free
A lot of children grow up with a sense of entitlement about money and “things.” From an early age, all children should understand that money doesn’t come free. There’s always a price to be paid. Whenever you spend $50 on a meal eating out, that is a couple of hour’s worth of work. You should teach them that time is money and it’s important to be wise about where it’s spent.
Check out more ways to teach your kids to save money!