Teaching your children important financial lessons should be deemed as an important and mandatory parental obligation. Financial skills are, after all, crucial, and imparting your kids with the necessary financial education can help them go a long way towards their journey to adulthood.
But arming your 3-year old with financial concepts can be tricky, especially if you have kids in business, too. To help you navigate your way towards giving your child a good financial foundation, here are some tips on how you can guide your child into understanding money better.
- Teach them about the concept of delayed gratification. Delayed gratification is an important concept that even adults sometimes fail to grasp. But teaching this to your child early on may increase the chances of them becoming more financially independent once they reach adulthood. Start by telling them that waiting is not necessarily a bad thing, particularly if they want something. As to how they can get something by waiting, begin by teaching them how to save.
- Instruct them how to save. Probably the most common way of teaching children the concept of saving is by giving them a piggy bank or a money jar and then instructing them to fill it up everytime you give them their allowance. But do not just do this! Make sure to explain to them the importance of the act. At the very least, they should understand why putting money away is important and not because you simply said so.
- Help them understand the idea of setting goals. Kids will usually want something, and they will definitely want it at that very moment. You can help them correct this behavior by teaching them the idea of goal setting. Do this by asking them what they want and then giving them advice on how they can get it.
- Make them learn the importance of choice. understanding how or why you spend money is an essential financial skill to have. One way to do this is by including your child in one of your family finance discussions and asking for their input. Once you decide on a course of action, make sure to explain that decision to them.
- Give them a brief overview of finance. Finance and kids are probably two words that do not normally mix together. However, it cannot hurt to teach your child about interest rates and, to some extent, stocks. Who knows? Maybe the idea might just excite them.
When it comes to helping your kids develop a good financial mindset, always note that you can never start too early. In fact, the earlier you do this, the better off your kids will be. Setting the stage early on for them may, perhaps, be the greatest investment you will ever make. And, in a way, you are also doing your part in raising a productive member of society as well.