Here are some of the ways children can be taught about managing money:
Daily financial tasks
Get your kids involved in daily financial tasks such as paying bills. Parents need to talk to their kids about setting financial priorities, the importance of saving for the future and give them space to weigh in on the pros and cons of household purchases.
Effort and reward
Once their kids are old enough, parents should consider paying them an allowance for helping around the house that will allow them to practice money management skills.
“Simple rewards systems such as earning money from washing the family car over the weekend or cleaning the pool can be a great way to reward good behaviour as well as better school results and completing household chores,” Williams said.
Oberholzer, who agrees with Williams, said that doing chores for pocket money offers kids educational moments that they can learn from.
Money management habits
Kids can be introduced to healthy money management habits by encouraging them to start saving for the things that they want to buy. Parents should also encourage their kids to share their financial goals and work with them to create a plan to that will help them achieve those goals.
Wants and needs
Parents can show their kids the difference between want and need by setting a good example for them to follow.
Williams said, “By going on extravagant shopping sprees when you can’t afford to, is not going to teach your child restraint.
“A legacy of saving, investing, wealth preservation and responsible spending will go a long way to ensuring that your financial legacy truly lasts, and does not end with the next generation.”
“By starting early, parents can help their kids acquire the knowledge, practical skills, and confidence to make informed financial future decisions,” Oberholzer said.
