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Learning about money is an important aspect of growing up that some children miss out on. It can be a big shock when you become responsible for paying your own bills if you haven’t been trained to handle money well. Fortunately, there are lots of ways you can educate your children about money while they’re young.

Take a look at some of these simple tips.

Make Your Children Earn Money

Giving your child pocket money is a great way to get started on learning about finance. It’s essential that children understand that money is earned. Give your child some chores to do around the house and when they have completed them, give them a set amount of money.

It’s important to stick to the rules with this. If the chores are not completed, your child should have to wait until his next chores before he can get his pocket money.

Take Your Children Shopping

This isn’t about going on a shopping spree, as tempting as it may be. Tell your child he can spend the money he has earned and take him to a store. Children need to understand that things have value and they may not be able to afford what they want.

Explain how much money your child has and what he’s able to buy. If he opts for something he can’t afford he has two choices: choose something else or wait until he saves the correct amount of money.

Educate Yourself

You can only teach what you know so it’s vital that you’re constantly educating yourself. Using money wisely isn’t always easy but it can come with practice. Talking to financial advisers can give you the information to get your own finances in order and pass on your wisdom to your children.

Look into better deals on insurance, your mortgage, your car, and everything in between. Aim to better your credit score so you’re seen more favourably to lenders in the future.

Needs vs Wants

Your children should learn to tell the difference between needs and wants. Prioritising how money is spent is a great thing to learn for the future. For example, if your child wants a new computer game but needs new shoes teach him how to prioritise.

Needs should always come before wants and the sooner your child understands this, the better equipped he will be for the future. 

Say No

Many children love the excitement of impulse buys. You’ve probably heard your child ask the question ‘Can I please have this?’ when you’re shopping. Giving in to those impulses will enforce the theory that money is never-ending.

It’s great to treat your children but it’s also okay to say no. Let your child know that there is an end to money and that will be times when you can’t afford to buy those impulse gifts. 

To buy the gift, more work needs to be done so more money can be earned.

Give to Others

This is a great time to get your child involved in the concept of giving. Teaching your child that the money you earn can have a positive effect on other people’s lives is something that will stay with them. Consider asking them to spend some of their own money on a toy for another child at Christmas. 

Similarly, they could put together a food hamper for a local food bank. It’s a great thing to learn that the money you earn isn’t always about what you want but how you might help others.

Contentment

Many people end up comparing their own lives with someone else’s highlight reel. Your children may look through social media and see expensive cars, handbags, big houses, and much more. Although it’s important to set financial goals and aim for the things they want, it’s also important to appreciate what they’ve got.

If the money they have can buy them what they need, that’s something to be thankful for. Constantly comparing what they have to what someone else has could mean they’re never happy with their own situation.

Set up a Bank Account

If you have a teenager at home, setting up a bank account is a must. It’s a great step towards learning about the world of banking and how to keep track of their money. It’s also often easier for parents to transfer pocket money instead of dealing with cash.

Managing an account online or through an app will give your child the opportunity to explore how things work.

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