We as parents put our kids on certain paths. The path to good hygiene, "always brush your teeth before bed", the path to being well mannered, "remember your please and thank you", or the path of being sympathetic "you say sorry if you hurt someone", the list goes on. The path that we tend to forget about especially with young children is the path to good money sense. We all want our kids to be good with money, but what does this mean and how can we help them achieve this?
Don't know about you, but my parents were not great savers, just great spenders. My brother on the other hand has always been amazing with money. He always had it, and was not too keen on parting with it. As for my other brother and I, we loved to spend. Saving for us was a bore and lacked instant gratification. While we were children that all lived under the same roof, and all witnessed our parents money habits, how can it be that we went down two very different money paths?
I firmly believe you pick up your habits from those closest to you. While we did all live together, the difference was, my brother spent most of his waking hours when he was a child with my grandfather, a much better role model when it came to money. He taught him how to both save money and how to spend it. He taught him how money can make you more money, and that money can either work for you, or you work for it. My parents didn't teach us anything about money other than what we observed. But my brother was purposefully taught by my grandfather from the tender age of four, and this difference, made all the difference to his money path.
Many of us make the mistake of thinking that our younger kids are too little to learn about money. We just know that when they get older we want them to be good with it. But how can this eventuate if we don't start teaching them when they are young. As soon as your child understands that items can be purchased with money, it's time to start teaching them. You start small of course, and in a very simplistic way. But these simple little lessons will become the scaffolding that prepares them for future more indepth money lessons such as handling their own money, even if it's just a few coins to spend at the school canteen.
I have compiled a list on how you can start to teach your young child about money, and assist them in going down a great money path.
How to Guide your Kids Down a Great Money Path
* Talk about money to your kids and share money matters in line with the child's age. When your kids leave the light on in their room for example, talk about the electricity bill and how lights on cost money and we want to save it. Little comments such as these shows kids that it can be a choice to spend or save money, rather than it being something totally out of our control.
* If your child wants something big, if old enough, get them to write it down and put it somewhere in their room. More than half the time, you will find that not too far away, they will no longer want it. This writing down of things they want seems to fill a need at the time which can tend to disappear.
* Teach your kids about window shopping. Too quickly we jump on them "now don't be looking at that, you have enough toys at home already". Look at items they like with them, comment on the item, look at the back of the box, tell them it IS cool and you can understand how they would want it and maybe, just maybe, they might get it for their birthday. This window shopping and actually touching and looking closely at the item does the same thing as the writing it down. Window shopping is a part of most peoples lives, so teach your kids how to do it. How to look at something you like and still be able to walk away.
* With school canteen being your child's first experiences with handling money independently, think first about how you want to introduce it to them and what the rules are surrounding it? Canteen money can be a great opportunity for that first big money lesson.
* Set up a bank account once your child starts school. Some schools have a banking day where you can bring in money to be put into an account. If not, you and your child set up your own. When you're next in the bank, talk about it. Why do we put money in the bank, why might we take it out? Talk about banking rewards such as them giving you money (interest) the more you save. Many banks have a counting machine you can use. My kids love to empty their money boxes into these machines, watch it count, then take it to the cashier to deposit while keeping a little for a treat. Many parents leave it up to the school to teach kids about money and banking. Sure, schools may teach currency and collect their banking money for the week, but do they teach them about good money decisions?
* Money boxes for different things. My kids have two money boxes. One is for their savings, and the other for their spending. When someone gives them money, I encourage them to put some in their savings box, and some in their spending money box. My kids also put their left over change if any from the canteen into their savings box. I am trying to teach them that spending and saving can go together. That there can be a happy medium.
* If you gamble, do not discuss this infront of the kids. Kids live what they learn, and if they learn that gambling is a normal way of life, then that is the path they are more likely to choose.
* Teach your kids how they can be empowered to get money for themselves, and the way to do this is like everyone else, jobs. Create with your child a list of small jobs/responsibilities they can do to earn their money. Ensure the jobs are more than achievable & inline developmentally. For younger children jobs tend to be more about completing routine tasks such as completing homework, making your bed, getting dressed for preschool or school, or simply remembering your hat. For older children you can start to introduce jobs such as dusting, sweeping or folding.
* Allowances I believe should be reserved for the school aged child. Allowances work best when your child has learnt more about how much things cost. I would recommend allowances not to start before they are at least ten years of age.
* Be consistent with the strategies you put into place to teach your kids about money.
Consistency is a killer, because it can be so hard to do, but consistency when we are trying to teach our kids most lessons, is king. It also teaches our kids to stick to a certain path making those habits "normal", it's just what you do, it ingrains into them making those habits become second nature, like brushing your teeth, or saying sorry if you accidentally hurt someone.
* Point out your own money rules to your children. Grocery shopping is a great time to do this. Do you wait for something to be special before you buy it? Do you go for the buy 2 for 1 offer? Do you look at cheaper brands to save money? Do you save the petrol discount docket? Voice what you do, it will help your kids to learn.
The Commonwealth Bank has developed a game for 5-12-year-olds called Coinland. This is an interactive game designed to teach young children about money. Certainly worth your attention.
Described by many as one of the most dynamic speakers in the early childhood industry, Danielle has now educated thousands of parents on a wide range of topics surrounding early childhood. Mum of three in 17 months including twins and a special needs child, Danielle is well aware of the battles that families face today with young children.
Creator of the "Early Years Toolbox" and "Ready Set School" talks, Danielle's humor and child impersonations always leave her audience wanting more. Those who have seen her claim "she gets it".