10 Steps To Help Children Learn About Money Management - Expert's Tips
Knowing how to spend and manage money is an important life skill that adults must teach kids. Here are some simple but effective steps to achieve that.
If you think 'money matters' is only what adults need to understand, think again. Experts say that it's essential to teach the value of money and tips on money management from a young age. Anita Madan, Head of Curriculum Development, EuroKids, shares 10 tips on how children can be taught about managing money right from the start. (Pics: Freepik, Pexels, Pixabay)
Being Money-wise From Childhood
Value Of Money: Start Early
Initiating financial education at a young age is crucial as it builds a solid foundation for understanding money. Introducing simple lessons in saving and spending in ways that resonate with their age group, lays the groundwork for more complex financial concepts later on. For instance, introducing the concept of saving by using a piggy bank to collect spare change can be a fun and tangible way for young children to understand the value of money.
Teach Kids Need vs Want
Help kids understand the difference between essentials and non-essentials by illustrating everyday situations. Explain to them that while food and clothing are needs, toys and gadgets are wants. This can be reinforced by involving children in shopping trips and discussing choices made based on priorities.
Money Management: Save, Share, Spend
The three S's of money - saving, sharing, and spending - provide a comprehensive framework for financial education. Discuss the importance of saving for future goals, the joy of sharing with others in need, and the responsibility of spending wisely. Consider setting up three jars labelled "Save," "Share," and "Spend." When children receive their allowance, they can allocate a portion to each jar, helping them develop a well-rounded understanding of their financial choices.
Allocate Pocket Money
Introducing a weekly or monthly allowance system not only teaches budgeting and decision-making but also provides an opportunity for practical application. Encourage kids to allocate their allowance to different categories, instilling a sense of responsibility for managing their resources from an early age.
Teach Financial Goals
Encouraging kids to set financial goals as it instils the values of patience and discipline. If a child wants a new video game, help them calculate how much they need to save each week. This goal-oriented approach provides a tangible way for children to understand the rewards of financial planning and delayed gratification.