Money-Wise!

Teaching kids the value of money is no simple task... But there is no escaping from it either! The Woman lists out some simple tips on talking ‘money’ with your young ones.

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Money doesn’t really grow on trees. Try telling that to your six-year-old though. Chances are he/she will think you’re bluffing. After all, you always seem like you’re loaded with money; why shouldn’t they think that you’re an automated money making machine which also just happens to make some excellent peanut butter and jelly sandwiches? Yes, teaching kids the value of money is no simple task, but it is a lesson that they must learn if they are to be successful in life and if you want to have any money left over before they leave for college. Here are some handy tips to teach your young ‘uns about the value of money. These lessons will stick with them for life, turning them into responsible, credit worthy adults!

Make Them Work

Doling out presents right and left is not a good place to start. If your child wants money, don’t fork it over, no questions asked. Sit down with them and ask them what they want it for. Encourage them to find out what the price of the item is on their own. Then work out a deal. Assign an allowance in exchange for them helping out around the house- taking out the trash, doing the laundry and/or weeding the garden. Explain to your child how saving up his or her allowance will help them buy that new toy they want so badly. Together, work out how long it will to take to save up enough money to buy it.

Not only will this teach them that money is hard earned, it will also probably make them respect you more; mom makes household chores look effortless, who knew they could be so hard!

Patience is a Virtue

If your little girl wants an iPod, an item too pricey for her to able to save up for all on her own, don’t rush to the store and buy it for her. Make her wait for it, so she knows that material things are not so easy to come by. Alternatively, if it is too expensive for you to be able to afford at the moment, don’t be afraid to say no. This will teach your child the valuable lesson that they can’t always get, or more importantly afford, what they want!

Explain the Basics

If your child asks why they can’t have that new teddy displayed in the corner toy store’s window, don’t pass their questions off with a simple “because I say so!” Your kids are smarter than you give them credit for. Explain that money is earned through hard work and used for food, housing, clothing- all the necessities. Let them know that luxuries are fun, but they are not needs and cannot be expected to be indulged all the time. If you explain this patiently and kindly to them, chances are your children will understand and probably think long and hard next time they ask you for a new toy or gadget. This will also encourage them to weight up the costs and benefits of purchasing a new item; do I need this vs how much will it cost!?

Debt is an Ugly Mistress

Borrowing is a dangerous road to go down. Sure your kids are not being hunted down by robbers just yet, but a little credit for the school canteen, and before you know it, they’re forty years old and knee deep in debt. Tell your children that if they really need money, they should come to you first and explain what it’s for. Borrowing from friends is not ok. If you think they deserve the loan, lend them the money. Also, work out a savings plan for them with them so that they can easily pay you back.

Grocery Store Trips

A trip to the local grocery store can be a wonderful learning opportunity. Take your kids along and encourage them to work out how ‘saving coupons’ work. When you’re shopping at the two for one aisle, explain how and why this is a good bargain for money. This is your child’s first indirect foray into the world of money so make the most of it. At least they’ll learn what value for money means!

Most importantly, always remember to communicate with your children! Don’t be too hard on them. Once in a while, a treat like a new toy can go a long way in letting them know you love them!

And the most important fact of all- birthdays are no-go areas when it comes to phrases like ‘responsibility’ and ‘value for money’! You’ll just have to dish out the money then!