Although school is where your kids go to learn, there are some life lessons that just aren’t taught in school. Among these lessons are lessons about money. So, if your kids don’t learn about finances in school, where will they learn then? Well, from you. Regardless of their age, it’s never too early to prepare them for life. Don’t wait until the last minute to teach them because old habits die hard, unfortunately. Take time out of your day to teach your kids these money lessons that they’ll need later on in life.
Money Doesn’t Grow On Trees
This is actually something I heard from my mom a lot as a kid. Just like other kids, they’re not yet too familiar with the concept of money and working for it. Therefore, it’s important that you sit them down and explain to them how money is earned, such as what you do to earn money and what happens if you don’t work for it. The more you talk with your kids about it, the more they’ll have a grasp on the topic even at a young age. This is also a good thing to talk to them about if you plan on giving them an allowance or extra money by doing chores.
Save Wisely
This next lesson is in connection with the previous one. You’ve talked to your child about the value of working to earn money. Now, it’s time to teach them about the value of budgeting and saving. Before they blow all of their money at a toy store, teach them that while they can do that, they can also save it and go for a bigger toy the next time they earn money. If you have a teenager with you, you can focus on a bigger example that might motivate them to save more, especially if they want to go to college. Take it one step further by explaining to them the value of budgeting, too. Provide them examples of how you budget your money on necessities, non-necessities, and savings. Also talk about how important it is to set aside an emergency fund in case you get into unforeseen situations.
Borrow Responsibly
Savings can be a big help in most situations, but sometimes they’re not enough to cover everything. In certain situations, you may need to take out a loan. If your kids are a bit and more mature, you can be a bit more open about your finances. Teach them the value of borrowing responsibly and only to borrow money when it’s deemed completely necessary, and, of course, making sure they can afford to pay it back. Be open about the effects of having debt in their life.