Teach your children how to handle money from an early age.
If you want to help your children stay out of monetary trouble when they get older, then you should definitely help them learn how to spend and save money wisely. While it is always tempting to give your children what they want, when it comes to kids and money, you should definitely start out with firm rules so that they know how it should be spent. One of the best ways to make sure that your children start learning how to spend money is to start out giving them control over small amounts of money from an early age. This way, you can start to teach them lessons over where they should spend their money without giving your children too much control.
Many parents decide to give allowances. This can work, and has worked for many parents. However, sometimes you won’t be teaching the right lessons about money if you just set up a fixed allowance for every week. Many parents have found that they get better results with kids and money by making the allowance conditional on doing certain chores. This is one way of adding more meaning to money. Money is not just something that they are guaranteed – it is actually tied to doing chores around the house.
The other important thing is to be firm about the money. If your child spends his or her money on a toy and then discovers something else that he or she wants more, then that is a lesson in making sure that they know what they want before buying. In this case, you should point out that they can buy the other toy after saving up their money – and that they should be more careful.
You should also encourage your children to learn how to save up money for the things they want. This is an important habit that many people do not seem to have – but being able to save their money will help keep them out of financial trouble later in life.
It is important for kids and money to be acquainted with each other, since this way your children will learn from an early age how to handle money. You can also explain the difference between needs and wants, and show how money is linked to doing actual work.