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I am a parent. The proper way of managing finances is something that all parents must be able to teach their children, as early as they possible. I know this can be a bit more challenging, especially if your family is used to a life filled with all the pleasures life can offer. But no matter how rich your family may be, it’s still a must for you to teach your children to value any amount of money. Teaching them how to handle their finances is not being “kuripot” (stingy or thrifty) as what we Filipinos call it. Know that this is what will help them grow into responsible adults in the future, especially when it comes to the financial aspect of their lives. So, to help you with that, here are three simple and very practical financial management strategies that you can teach your children.
Teach them the importance of waiting and working for something they want to get.
The first financial management strategy that you have to teach your children is that they can’t ask money from you any time they want to. For example, if you are going to the grocery store to buy supplies, don’t let them buy just anything they want. Tell them that you have only brought an amount enough to buy all the necessary items. Also, when they are asking for money or gadgets that they want to have, let them “work” for it. Ask them to get good grades, for example. Positive reinforcement serves well in this case. Last year, I gave my then 7-year old son a “job”. He wanted to buy a toy. I told him that he must earn the money to be able to buy that toy. So he and I had agreed that he would be paid P20.00 everyday by simply picking his dirty clothes from the floor and by putting it in the laundry basket. Man, that was worth two birds in one stone. He learned responsibility and the value of work and money.
Get them a piggy bank.
This is a financial management strategy that you can share to your children, even though they’re only two or three years old. Get them a piggy bank and tell them how important it is for them to save money. From the money you and your relatives give them up to the coins they find, show them how fun it is to be able to save money, especially if they are eyeing to buy toys and other items that they might want to buy, especially for Christmas. I tell my son that we have the money to buy whatever he wants, but we decide not to buy anything but only what is needed and necessary. I don’t like the idea of telling kids, “We don’t have the money.” Words are powerful. I don’t want that power to transform my negative words into reality.
While you can still buy them some of the things they want, you can always make them experience the sense of fulfillment that we all get to buy something we want with our hard-earned money.
Also, this financial management strategy is useful in making them realize that if they have savings, they will not have to worry in times of emergency. They will still have money to spend for themselves, even if you are not around to give them money.
Guide them through decision-making when spending their money.
When it comes to financial management, it is imperative that your children know how to be wise in making decisions, especially when spending their money on items or services. When going to the mall to buy a pair of shoes, for example, and they are torn between two pairs of the same style, but are from different brands, let them know that they can get any of the two pairs that they have chosen. However, show them that they must be smart in spending their money by sharing to them the importance of the quality of the items they are buying. Also, teach them to be practical by showing them that the brand of the items they’re buying does not really matter, as long as the quality is met. Don’t buy the brand. Buy what you need.
Indeed, financial management is a lesson that people have to learn about while they’re still young. If they get used to living life lavishly and, in the future, they lose everything they used to have, they can end up suffering. So, start teaching them how important it is to be wise in spending every penny that they have while it’s still early. Watch them turn into the responsible adults that they’re supposed to be.
What are the financial lessons you teach your kids? Share them with me and my readers by commenting below.