07 Dec Ways to teach your children about saving money
Saving money is an essential aspect of life. No matter the age one must always have a habit of saving money. Kids from a very young age must be thought about the value of money and the importance of saving it.
Studies conducted in the year 2012 by the American Institute of CPA’s found that 60% of American parent give allowance to their children and only 1% of children save that money, this is because money is freely given without teaching about the value or the importance of saving it. Here are a few ways by which children can be thought about on how to save money-
1) Using a clear jar-
Using clear jars instead of using piggy banks is much better as a child can see their money growing. Unlike piggy banks that are opaque, clear jar helps a child to keep track of their money. Parents must get children excited about money by talking about the increasing value of money in the jar every day.
2) Value of commodities-
It is a parents responsibility to teach their children that everything in this world costs money. They must be thought about the value of the items that they possess. Each time a child wants something, parents must take money out of the jar and use it. This will have a better effect on them and will quickly make them understand the value of money.
3) Teach them about earning money-
They must be thought that earning money requires a lot of hard work. The simplest way of teaching them this is by giving them chores around the house and rewarding them with money once they complete the task. It is essential to show them that different type of work pays differently thus teaching them the value of money and how to earn it.
4) Avoid open wallet policy-
The concept of an open wallet creates a very negative and lazy attitude among children. This is where children can take money out of the wallet as they desire and use it. This will not teach them the value of money and the importance of it.
5) Teach them money management-
Along with saving money, it is also essential to teach them money management. They must be thought how much to spend, save and invest. Complete restriction on spending money must not be made as a child will never learn to manage money on their own. The modern-day savings jar for youngsters usually comes equipped with these segregations to help children manage money on their own.
6) Involve them while discussing money-
Despite the common practice of keeping the financial matter of home confidential, Children must be aware of the expenses that happen at home. When money matters are spoken, it helps children understand and helps them make wise decisions. At initial stages, it might feel awkward but it is an essential matter and thus must be followed on a regular basis.