It’s always a good idea to help kids understand the value of money from an early age. Creating a solid foundation can help set the course for them to grow up with the ability to manage their own finances, even if it just starts with a household allowance. If a child earns their own money by doing chores for example, they will begin to understand their own self worth and build confidence by learning they can earn their own money and eventually become an independent adult as a result.
If you want to help your kids at a young age to understand how to not only handle money, but save it too, a good old fashioned piggy bank still works! Even if the child is very young, give them a chore to do which they get paid for. Participating in the act of depositing money into their piggy bank can help them to develop a sense of saving money. It’s also good to give them a reward for their accomplishments by allowing them to take some of the money they’ve earned to buy a treat or a new toy. This can teach them that hard work is rewarded, but saving money is also important.
As kids get older, open a bank account for them; even if it’s a joint account with a parent at first. This will help them to understand things like how to make deposits, check balances and tuck money away for savings. If your child is old enough to have a cell phone or computer device, it’s easy enough to teach them how to use the online banking app. Virtually every bank has an app these days which can be downloaded to a smart phone or tablet, or accessed though a browser on the bank’s web site.
By the time the child is a teenager, he or she should be adept enough to handle their bank account on their own. Once they begin to work a part-time job while still in school, they should have a basic understanding of budgeting their pay. For example, you can teach them to use one-third for every day expenses like lunch, one-third for bills such as their cell phone, and one-third should go into a savings account. Giving a structure early on will help them to handle bigger finances once they grow up, finish college and enter the working world. Following these basic guidelines, with adjustments for individual situations of course, will help your child enter the adult world with the skills to mange their finances properly.
Ann is a professional writer who brings dedicated experience having written international and domestic news, blogs, and web content for over 20 years. She’s also a published poet and graphic designer with degrees in Business and Graphic Communications and has been a music distributor, music industry sponsorship sales director and band manager.