It is better to start teaching your child about money matters early in life. According to a study, it has been found that children start understanding the different concepts of finance around the age of 6 to 12 years. Moreover, they can understand the concept of saving as early as 2 years, so teaching them about saving, exchange, etc, as early as four years won’t be very difficult. As soon as they start understanding that we give money to buy things, they will also begin to grasp the concept of saving.
You can start teaching them about saving money in very simple terms. The sooner they learn about such things the better it will be for them when they are older because these habits would be deeply ingrained by then.
1. Use Jars And Labels:
You can help them make different jars or piggy banks with labels of things they want. They can have short-term or long-term goals of saving. Say, they want a specific toy, they can start saving for it in a particular jar, while something bigger like for a trip to Disneyland, they need to save more. They can also have something like a ‘everyday spending jar’. This way they will be able to prioritize and save accordingly.
2. Board Games Help:
Board games like Monopoly and others helps a lot in teaching kids about money, exchange and savings. Games help them in planning and strategizing for every move. You can also teach them effectively, if they are doing something wrong.
3. Give Rewards For Saving:
You can appreciate or reward them for saving money. You can give them some stickers or some extra play time or probably the rest of the share if they are running short of a small amount of money for something they need. This way they feel rewarded, and want to continue to save.
4. A Good Example Helps:
Use your own habits as an example. Show them that saving money is good and that it has long-term benefits. You need to make them realize that saving is important and that everyone has a unique approach to it. Your example should motivate them to keep going.
5. Make A Saving Goal Chart:
Encourage them to maintain a goal chart – how much money they need to save and by when, how much is done, etc. This way they can plan and prioritize..
Money lessons are important because they employ simple math in their day-to-day life.This is an easy way to get your child to like an oft reviled subject. Understanding the fundamentals is very important and what better way than to start at home with interesting tools and techniques. Good habits taught today will surely help them tomorrow. So, encourage your child to save money and show them how you do it too. They learn better if they see their parents doing whatever they are asked to do.