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Prepare Your Children for the Road Ahead with These Important Financial Lessons

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As parents, it falls to us to prepare our children for life and set them up for success. While the educational system is there to teach most of the academic stuff we can’t teach, we have the primary responsibility of teaching our children how to conduct their affairs and how they manage their lives, finances included.

We’re not talking about teaching them the ins and outs of forex or how property tax grievance firms work. Instead, we should take the time to lay down the proper financial management foundation as early as we can.

Ages 3 to 5 years

1. Save money using clear jars.

While a piggy bank is a good way for kids to save money, the visual impact is lost on them. Have them put their money in clear jars instead, so they actually see how much they can save over time.

2. Be a good role model for them.

It would be pointless to teach them something, yet do the opposite. If you want your children to learn how to handle their money properly, you have to be willing to do the same thing, too. Monkey see, monkey do. Remember that.

3. Show them that everything costs money.

The concept that money doesn’t grow on trees should be something children know early on. A good way to reinforce this is when they want to buy some toys or snacks. Have them pay for what they want with their glass jar money. This will have a greater impact on them more than a ten-minute lecture.

Ages 6 to 12 years

Mother playing with kids4. Teach them the value of choices.

Everything in life is the result of the choices we make. That being said, children should know how to make sound decisions when it comes to money and how they spend it. They need to understand that each decision has several possible outcomes, some good, others bad.

5. Pay them accordingly; don’t just hand out allowances.

The reality is money is earned and not just given freely. One of the best ways to teach them to work for money is to “pay” them for the chores they do instead of just giving them allowances to which they think they’re entitled to.

6. Patience is more than just a virtue.

Patience will save them from impulse buys. The ability to hold out on a purchase will be valuable to them in the long run. Studies show that those who practice delayed gratification are more successful in life compared to the impulsive ones.

Ages 13 to 18 years

7. Teach them to budget.

A very big part of money management is budgeting. Show your children how to properly budget their money by outlining their “income” and expenses. The visual impact of seeing how much they’re getting versus how much they’re spending will leave its mark.

8. Show them the consequences of mishandling finances.

Consequently, if money is mismanaged, they need to see how bad things can get. Getting into debt by taking on loans and irresponsible use of credit cards are the main culprits. Teach them to steer clear of student loans as much as possible and avoid the unnecessary use of credit cards.

9. Teach them to be enterprising.

Resourcefulness is a trait that they need to be equipped with. The ability to come up with different ways of earning and adding to their income is something that will serve them well for life.

Parents are given the great privilege of raising world-changers and movers. Never take that for granted. The time and energy you invest in your children today will help shape the world they will make for themselves in the future.

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