Parents should not let their children gear their lives to money-making schemes to the extent that they endanger their own lives. Former US president Barack Obama once said that “Money is not everything, but it makes a big difference.” Let your children know that life is sacred and money is temporary so they shouldn’t prioritize acquiring money ahead of living a full life. In the end, it doesn’t matter the amount of money that one makes; what matters is how you spend and manage the money in your hands.
Heads up: This article was commissioned as a part of the Adam Rush Project. It was an experiment I did a few years ago to see if having books written by ghostwriters would be commercially viable. It wasn't. That said, the following article was written by someone else and not yet edited to my standards. I hope to find time to rewrite it myself in the future, but for now, read with caution.
That said, with the financial challenges that are currently facing the world, it’s only prudent to convey knowledge about money to your kids from an early age. You should teach your kids how to make money, keep track of finances, save money, and how to wisely spend money. Teaching your kids about money should be a continuous process. Here are the thirty practical and tested ways to teach your kids about money:
1. Play money games
Take advantage of technology to impart knowledge about money to your kids. Many computer games let the player earn and manage imaginary money. Even car racing games that incur penalties when you commit reckless mistakes can teach vital concepts about money. Such games can teach minimizing risk and preserving finances accumulated through hard work.
2. Allow the kids earn money
Most children do not like having to ask for money from parents or relatives every time they want something, so you need to allow them to earn their own money. If your child likes getting money from other people, you need to get them out of the habit by introducing a means of earning some money. Children can do chores like working in the family garden, housework, and working in other family enterprises to raise a little money on their own.
3. Make learning fun
If children find working for money boring, they may lose interest quickly. Try to make learning about money fun. Come up with lessons that have sufficient fun to raise kids’ interest on issues dealing with money.
4. Teach teens about credit cards
Once your child is old enough to make money, it’s the best time to teach them about credit cards. They need to know the importance of having a credit card and the consequences of not paying their debts on time. They should know the best ways to improve their credit score. It’s never too early to learn.
5. Allow them to make small money mistakes
The best way to learn about money is by losing it. The more mistakes your kids make while handling money, the more they learn about money. However, you need to be always on standby to guide them if they need help.
6. Teach philanthropy
Children need to know how to be helpful to the society they live in by donating some funds or performing charitable activities. Also, they should learn to help those around them who are less fortunate. For instance, children could take part in races to raise money for people living with disabilities.
7. Teach them about taxes
To become patriotic responsible adults, children need to understand why paying taxes is important and the repercussions of tax evasion. Discuss sales tax when you’re at the store buying things. Show them how you pay taxes every year. You can even have them pay taxes to you on their allowances!
8. Give your kids a piggy bank
For many children, a piggy bank represents their first experience with a “bank account.” A piggy bank can be as simple as a tightly closed jar or sealed box with a slot cut from the top. Put an initial deposit into the bank then let the child add their own deposits at will. It’s important to teach your child the benefits of having a savings account, but you need to grant full ownership of the account to your kid.
9. Teach your child about long-term planning
Long-term planning is not just for grownups. It’s especially important for kids to learn planning skills because the future belongs to them. Start early when teaching your kids about saving up for things they want.
10. Teach your child about insurance
Insurance is a part of modern lifestyle. Teach your kids about how insurance works. You can even set up your own insurance plans that your children can pay for with their allowance or savings.
11. Teach children how to set goals
Children should be aware that they can only succeed if they make goals in life. Teach your children to make realistic goals and how to make a plan for achieving them. You can use the SMART framework for setting goals: make all goals Specific, Measurable, Attainable, Relevant, and Timely.
12. Teach your children to invest
Let your kid know what to do with the money that they’ve successfully saved. This mainly applies to teenage kids. Some common investments you should teach your kids include banking, stock markets, and real estate.
13. Teach your children to budget
The same way your kids are fully dependent on you for their survival, your children too will have dependents in future. Advise the kids from earlier ages on the basic family obligations that they must have in their budgets. Tell your children about paying rents, paying mortgages, buying food, setting aside money for education and other bills.
14. Open bank accounts for your kids
The current world just requires everyone to have an account including little children. It’s these bank accounts where you’ll help your kids will transfer the money that they’ve accumulated in their piggy accounts.
15. The use of allowance fund
The children often receive some money for personal effects. It’s to help the kids to know the best way to use the money within a given period. Impart adequate knowledge to the children in the best ways that they can manage their allowances.
16. Show the children money
The teaching that you give the children will be futile unless you show them the subject of your talks. Make money visible so that your children may know what you are talking about. If possible, you can show the kids the receipts of transactions like power bills, water bills and school fees for them to know what money practically does.
17. Make them aware of family finances
It’s never enough to tell the children things that you aren’t able to afford, but instead, you need to explain to them the reasons why you can’t afford them. Tell the children about other basic bills that you’ve to pay thus lowering your ability to afford what they need you to buy.
18. Teach the children how to count money
As your children grow, you need to begin sending them to do some shopping and see if they know the costs of goods in the market. The older children should be aware of the balance that they should receive after making purchases.
19. Tell the children about religious funds
If your children have belief in some faith, make them aware of what is expected of them. For instance, children who are Christians should learn the habit of paying tithes while Muslim children should be taught why they need to take part in the offering of alms.
20. Advise them on the dangers of gambling
Make the children how they stand a thin prospect of obtaining money through gambling. Also, cite for them influential individuals who have lost their wealth through gambling. The children should be aware that gambling can cause them to become irresponsible and even become paupers.
21. Enroll your kids in financial learning
As the ages of your kids rise, you might realize that your children require sophisticated financial knowledge that you may not provide to them. It’s at this stage that you should enroll your children in colleges to learn from experts. The teens need have ideas about money even if they are pursuing courses that don’t relate with finance. For instance, if your child is doing environmental sciences, try to urge them to register for short financial courses to obtain some gist about money.
22. Hobby pays
Let your children know that they can make income through what they love doing. For instance, you can cite for them football superstars like Lionel Messi who earn a massive amount of money because of the sport he plays. It’s clear that mentoring children is another sure avenue for financial income in the modern world. In fact, it’s compulsory for sports’ professionals to take entrepreneurship courses.
23. Encourage the children to save
Saving is never easy, and you’ll need some incentive to make it work with your children. The children can succeed in meeting their saving target if you offer them incentives like doubling for them whatever they’ve saved within a given month. Show the children a few things that you’ve managed to do due to your saving skills and the discipline that you display on matters that concern money.
24. Start lending your teenage children money
Once your children have reached the ages where they can easily earn from activities they undertake, don’t give them money for free but lend them. While lending them the money, include terms of repayment of the loan that are both agreeable to you and your child. The practice enables the child to be responsible and self-dependent. Also, sometimes you need to borrow money from your child even if you have enough finance to expose your child to what happens in the real world.
25. Make it clear to your children that money comes from hard work
Advise your kids that everything you own came to you because of your industrious nature. The children should equally know that fate doesn’t bring much and they shouldn’t rely on luck to succeed in life. Tell the young ones to take their time in whatever the activity that they undertake to achieve quality results that can fetch higher pay.
26. Warn your child about the dangers of drug trafficking
Most children may be living with the knowledge that they can raise a massive amount of money outside their careers and professions. Point to the children how risky it is to smuggle drug from one country to another. Also, tell them that they are likely to lose the good reputation they have in the society if they engage themselves in such dirty deals.
27. Lead an exemplary life
Make yourself the mirror of finance that you need your children to copy. Even if you haven’t made it in the financial world, just try to offer some little knowledge to the kids. Whatever you tell your children can achieve its cause if you set an example to your children in the kind of
lifestyle you lead.
28. Drugs, Alcohol never mix with money
It’s important to point it out to the children that if in future they indulge themselves in excessive consumption of alcohol and the abuse of drugs, they will lose all the money they’ve saved. Make it clear to them that addictive habit like take alcohol reduces the performance at work thus limiting the money one can earn.
29. Encourage career planning
Make it clear to your kids that people earn from their careers and the career they choose will determine the amount of wealth that they can make. The say goes that not planning is like planning to fail. The education about careers is only relevant to the teenagers. If possible, you can arrange for talks from professionals from the careers that your children are interested in pursuing later in life
30. Teach them about financial trauma
Money has many corners the same way a coin does so it depends on what one does with money that determines the impact the currency can bring. Though many people associate money with happiness, there are high chances that money can cause the exact opposite. In fact, several people have lost their lives due to bad deals that involve money.
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