5 Money Lessons to Prepare Your Kid for The World
Spending more time at home with your son or daughter means playing “teacher” for the most part of COVID and running a central role in their everyday learning.
But as you help impart curriculum content, parents mustn’t forget to touch on fundamental life skills like money management.
That being said, below are some lessons to introduce your son or daughter to the world of dollars without further ado.
1. Money doesn’t come free.
Your child may not understand where you get money from. They may fail to realize that there’s not always enough money to buy everything they desire.
Remind them that money is the result of work and that it is often limited in supply.
2. Spend within Your Limits
Kids do not understand that when money is borrowed, it must be returned to the lender. It’s also crucial to mention that if they lose everything in their home savings bank, there’ll be nothing left to spend on the other things they may need later.
Discuss with older kids the dangers of overspending and the importance of maintaining good credit. Stress that undesirable credit due to poor money management at youth hood can hurt eligibility for an auto or mortgage loan in the future.
3. Think before Your Spend
Train your child to think before they spend. Teach them to use these three questions to decide on a purchase:
- Do I have the money to buy it?
- Is the spending worth it?
- Will I regret spending the amount?
These three simple questions can help kids mature up when it comes to making spending decisions.
4. Always be a saver
Demonstrate to kids how easy saving money is when done consistently, even in small dollars.
Stress that saving is the key to achieving bigger goals. Also, mention the vital role of a savings account to an adult, like how it can safeguard you from unexpected situations like sudden job loss.
5. Money management requires discipline
Lastly, you want to highlight the importance of discipline in proper money management. Teach your young-one that sometimes they have to sacrifice current needs to save for their future goals. Discourage them from buying impulsively, hoping they will get or make more money in the future.
Money management, like any other lesson, should begin early in life. That way, your kid will master lessons that most people learn in adulthood. Please don’t wait until it’s too late. Start now!
Author Bio: Michael Hollis is a Detroit native who has helped hundreds of business owners with their business loans. He’s experimented with various occupations: computer programming, dog-training, accounting… But his favorite is the one he’s now doing — providing business funding for hard-working business owners across the country.