As parents, we want the best for our kids. They’re our world (hey Indy and Mia!), so we want to prepare them for when they reach an age to discover it themselves. This includes developing those imperative money foundations early in life so they can build on them throughout their journey.
You may not know it at the time, but you can have a lot of influence when it comes to shaping money habits. Trips to the supermarket or shopping centre can be the perfect opportunity to ignite discussions and spark a real interest for your kids.
However, knowing where to start can be tricky. With all tricky things in life, we recommend starting with the basics.
So, we’ve compiled 5 easy steps to help you teach basic money concepts to your little ones. Here we go!
1. Introduce the concept of money
This first step doesn’t need to be complex, start off by explaining what money is and how it is used. This could mean taking out a few notes and coins. I know, I know, in an increasingly cashless society this is difficult, but allowing your kids to see money being exchanged will help them to recognise money and its importance.
2. Describe how money is earned
One of the key steps for kids to understand the value of money is to teach them that it doesn’t magically appear. Telling them the way/s that you earn money is a great place to start. And if you find your kids asking few questions here and there, take the opportunity to strike up a conversation.
3. Explain the difference between needs and wants
Does anyone else remember learning this concept in primary school?! I love to use examples when explaining the difference to my girls, Indy, and Mia. And as your kids grow older, encourage them to consider the two concepts before spending their money.
4. Create opportunities to earn money
Pocket money will be your best friend for this step – it is a fantastic way to demonstrate to kids that they will need to earn money rather than expecting it to be handed to them. Have them involved in chores or other tasks around the house to earn their pocket money.
5. Encourage a habit of saving
Whether it be setting up a piggy bank, bank account, or creating a money goal, familiarise your kids with the process of saving. A savings goal can be great for your kids to work towards something they want, allowing them to prioritise what they spend their money on. Creating a timeline for saving can be a great motivator to help them reach their goal.
If you have any further questions on how to tackle this topic, get in contact with the team IM Business Solutions today.