Today, it’s must for children to learn good money dealing and be ready to face the financial challenges in the middle age. Giving your children a good basis and teaching them about financial challenges is critical to their individual growth. Teaching children the basics such as how to save money, budget and spend will create good financial habits for life.
In a time of plastic money, people use internet banking, credit cards, and online shopping, kids don’t often see parents buying goods with physical money. Not seeing money exchanged for buying makes it difficult for children to learn the value of money and to know what things cost. They might consider this invisible form of money as an unlimited resource. That’s why; it’s become necessary to talk to kids about money to make them understand the reality of this invisible money.
Teaching children the value of money through real life circumstances and examples will really help them know where money comes from, how it is earned and how it should be spent. Parents should help children in the management of money. They should make them understand that what needs to be bought or what not with it. According to the family experts, it is not advisable to extend the budget if a child cannot make ends meet and spends a lot of money.
Providing a daily allowance helps children the first chance of doing some good planning of money. They can save the money to buy those toys or things that their parents would generally not buy. In a few cases, it can be beneficial to pay children for doing some useful things in the house. This is just to motivate and teach them, how the money is earned. Saving enables children to understand that you just cannot spend all the money you have. It will also make children ready for later phases of life, where saving will become more significant.
All parents don’t give money to their children. They usually purchase the things that children need. However, giving them an allowance makes them handle money in a better way. As per some family experts, giving children a small allowance at the age of 5 or 6 is appropriate. Getting a savings account open for them is a great way to make them understand that saving actually is important and increases the financial security.
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