As any parent can testify children are able to soak up knowledge from the moment their eyes are open and begin learning at an astonishing rate. But as parents do you or have you ever considered at what age its appropriate and useful to begin teaching kids about money and finances. Many parents aim at teaching literacy, numeracy and other forms of education from birth to 12 months, with the aim of beginning the process and bringing forth a child prodigy but should this include money and finances as well? Can it ever be too early to being teaching the concepts of finance to your kids.?
Take as an example the child waiting for the bus near my home the other day. The way she cried out incessantly at around age six, ‘Mum, give me money!’ . At that age how can she possibly understand and value the use of money as a tool and resource? Did anyone take the time to explain or teach her that money is not always available like the soil on the ground?
When should you be teaching children about money?
Here are some ways you can engage your child and begin giving them an understanding about finances.
- Try asking your child to stay put and await his turn at the slide if there are other kids ahead of him. Using this method you can teach the patience we adults understand with having to wait until money is available to buy what we want. After all parents automatically take care of the kids’ needs and so 3-5 yr olds may not understand scarcity let alone apply this to money.
- Think aloud as you deal with money. Teaching money to kids is more than giving instructions. If you verbalize the important moves that you make, 6-10 yr olds will follow. You can, as an example, pick up a larger/bulk item while shopping and say, ‘This will take us through the month and we shall spend less than buying it every week’.
- Teaching kids about money is also rewarding especially in relation to long-term goals. 11-13 yr olds will appreciate the need to save for a longer term to be able to buy a more expensive but prestigious item like a Smartphone as opposed to saving for lollies. With this kind of understanding your child may grow up knowing there is need to make long-term goals and that these goals are more rewarding than short-term goals that call for less sacrifice.
- Teaching money to kids is also about evaluating options. 14-18 yr olds will understand you as you check out possible college options, checking out those that give grants and scholarships, and those that secure attachments for their students. Let them know that it is worth doing due diligence before committing to something that affects your life. Encouraging your kids to take on part-time jobs when they are of age teaches them about saving and making wise decisions.
- For the 18 yr olds and older, money matters should include the impact of using credit cards. You should teach them the need to pay off the credit card debt regularly and what happens if you fail to meet the interest repayments let alone repaying the principal. Let them know that your life can grind to a halt if you mess up with your credit rating.
You can also embark on teaching kids about money through the use of gaming and games. There are plenty of educational and recreational online games for kids where you can teach them about being in control of finances and money in simple ways. Let them know that they should not exceed the time agreed for playing games and that this is a resource like money. Let them know that exceeding the time agreed is a bad sign and they need to control their use of games rather than it control them.
Talk to them about addiction and how the temptation to play on and on can make a person lose money and property as a grown up if they make similar poor decisions. Let them know that excessive gaming which is like gambling can bring you legal and social problems too. Teaching children about money can also be done using offline games. Even when kids are not playing cards for money, continuous playing can affect homework and other responsibilities.
An adult whose parents took teaching kids about money seriously often will actually stand out amongst others. You are that guy who owes nobody a cent and you are the same person who loans your buddies money when they have drunk all their salary. You won’t watch a second movie if you had set out to watch only one because your parents taught you the virtue of self-discipline. That’s why your life is organized when your colleagues seem so stressed and bitter with the world. Our kids you will agree with me, are a clean slate and teaching money to kids can be the equivalent to teaching them how to take the first walking steps. Once they master them, they become experts as they grow up. Adults who are successful in money matters and business either learnt the hard way from making mistakes and paying the bills for them, or they were lucky their parents taught them the ropes early.
Are you teaching your children about money? Is it too early for them to learn finances? Got an opinion from your early years? And dont forget to share for all those other parents out there!
***Photos thanks to trenttsd and L Ribeiro of Flickr***