One of the most important things you can teach your kids is financial responsibility. If you inform them of the basics, then you can be safe in the knowledge that they won’t squander everything they have once they move out. Teaching them this important life lesson at an early age will also get them into some good habits, such as saving and budgeting.
But how exactly do you teach your kids financial responsibility? Most of it comes from experience. However, these are some of the things that you can try and instil in them from an early age.
Reward Hard Work
It is important for children to know that the harder they work, the more they can earn. So next time your children spend a couple of hours doing some chores, consider increasing their pocket money accordingly. However, you shouldn’t pay them for all the chores you do. This can help to teach them that some tasks are just part of growing up. The tasks that go above and beyond should be rewarded. And you should remind them that if they go above and beyond in their career, they will reap the benefits.
Encourage Them To Save
Encouraging your kids to save their money from an early age can help them get into good habits for the future. If you do give them weekly pocket money, remind them that it is important not to save it all at once. If they save it in their bank, they can save up for something that they have always wanted. When they are saving, you should also let them know that buying things
this way is a lot safer than taking out unsecured loans. Make sure that older children know that second charge loans are the safer option if they ever run out of savings.
Get Them Involved With Budgeting
Whenever you sit down to do your monthly or weekly budget, try and get your children to join you. They can then see just how much work goes into planning the family’s money. Give them a chance to make their own suggestions of how you should spend the money. It is also a good idea to take them with you to the supermarket so they can see the money in action. Tell them about coupons and comparing brand prices can help them to save a whole load of money!
Let Them Make Mistakes
At first, your kids might make some mistakes with their own money. They could overspend their pocket money and might end up annoyed when they have none left! You should leave them to make these mistakes and not bail them out. Otherwise, they will never learn the importance of being sensible with their money. After making the same mistakes a few times, they will certainly learn from their mistakes!
You might be wary about leaving your children in charge of their own pocket money at first. But it will certainly pay off, and they will end up being extremely responsible with their finances!