Most of us, at some point in our lives, have made some financial blunders. Because of this, we usually want to teach our kids to avoid our mistakes and be smart about finances. However, it can be difficult to teach kids about smart financial practices when they seem too young to really understand the value of a dollar. To help you raise kids who understand money and are smart about finances, follow these tips on how to teach kids the value of a dollar.
Teach Them About What Money Is From An Early Age
Just about every moment you spend with your kids has the potential to be an opportunity to educate them and shopping is no exception. When you shop with your kids, explain to them the concept of how much things cost and how much you’re paying for the items you’re purchasing. These little informal lessons will help your kids to understand the concept of money from a young age.
Make Saving Money Fun
Kids don’t get excited about saving money easily. To young kids, the pleasure of saving money is difficult to grasp, while the pleasure of spending money is obvious. Use tools that will make saving money fun, such as personalized piggy banks. You can also help them to save for an expensive item by teaching them how much money they will need to save each week in order to be able to buy the item in a few months.
Create A Smart Allowance System
Allowances are a great way to teach kids about the value of a dollar. However, allowances are only educational when your kids are receiving that money in exchange for chores or good grades. It’s essential that your kids learn that money is earned and not just received. If your kids skip their chores or receive bad grades, it’s important that you withhold their allowance, no matter how much they might complain or beg.
Raising financially smart kids is challenging, but if you follow these tips, you can train your kids to understand the importance of earning and saving money. Your kids will have happier lives financially if they are educated about money from a very young age.