Learning to be responsible with money isn’t easy, and it certainly isn’t fun – especially if you learn the hard way. However, parents are responsible for imparting knowledge, which is why it’s better to teach your kids about money early in life. Being money-wise, teaching them to save, and letting them know when to get quick loans in NZ is just the start. Here are six ways to teach your kids about money that are fun and rewarding.
- Be Positive About Money
You might not think so, but kids hear everything. That’s why it’s important to speak positively about money, even when you think they can’t hear you. Children follow your behaviour, and the examples you set, which means that if you’re cynical about money, they’ll be too. A negative mindset about money might follow them into adulthood, which has few benefits.
If your family is in a challenging financial position, be honest. Explain what happened to put you in financial trouble, and show that you’re learning from your mistakes by repaying debt. Don’t make them worry about money because that mindset will follow them into adulthood. Finances can be managed effectively and aren’t always a scary nightmare.
- Give Them An Allowance
An allowance shouldn’t be treated as something pleasant for your kids to have, even though they’ll enjoy the benefits of having money of their own. It’s a great way to teach your children how to budget, how to make smart financial decisions, and how to spend it wisely.
Start with a small amount, and increase it slightly as they age. Your children will spend and manage their allowance differently, which means you’ll have to teach them individual lessons that are tailored specifically to each child.
- Use A Job Chart
A creative way to teach your kids how money relates to effort and hard work is to implement a job chart. A job chart lists chores that each child has to perform every week. If they do their duties well, they’ll be rewarded with a portion of their allowance. If they don’t, then they forfeit payment.
It might sound harsh; however, it’s a great way to teach your children accountability, and that effort means reward. Just as in adulthood, if you want a bigger house, you need to work hard to earn a salary, or to get an increase when you deserve it. They’ll also learn responsibility and reward.
- Start A Savings Account
Ask your children what they would like to do or buy. They could want anything – a trip to the zoo, new bikes, or a fish tank. Start with something small, like ice creams after school on a Friday at the end of the month. Encourage each to deposit money into your savings account, and teach them how interest rates work.
They’ll watch in awe as their money grows every day. They can deposit more money whenever they’d like, but make sure that you discuss what they want to save up for, and why. More importantly, make sure that they understand the consequences of not saving money at all, or withdrawing it prematurely for irresponsible spending.
- Implement Spend And Save Jars
Spend and save jars are another tactic that will teach your children how to be responsible with money. As opposed to the savings account, each child is responsible for their own spend and save jars. Allow them to allocate as much or as little as they’d like into each. They might put the majority of their allowance into their spending jars, which will provide the perfect opportunity to teach them how to spend money wisely.
- Teach Them The Difference Between Needs And Wants
Even some adults struggle to comprehend the concept of a need versus a want. When your kids are spending their money, explain the idea to them so that they understand it. Don’t stop them if they’re spending on a want, because they need to learn from their mistakes, and learn how to manage their personal finances. They’ll soon discover that a time will come when they need something but won’t have the money to buy it, because they’ve already splurged on a want. On the flip side, it’s also essential for them to learn that they don’t have to feel guilty when they spoil themselves with their hard-earned money.
Teaching your children how to manage their money will be challenging. However, it’ll also help prepare them for adulthood. Because of your lessons, they’ll start making money-wise decisions as soon as they earn their first paycheck. From responsibility and reward to the advantages and disadvantages of quick loans in NZ, these lessons teach them everything they need to know in a fun and educational matter.