Teaching money management to kids

Since schools remain shut while the world deals with this pandemic, as parents and elders we are blessed with a unique opportunity to spend more quality time with our children, albeit within the confines of our home. Let us look at a few useful tips to teach our children something that our education system has not been prepping them enough for – money management. The current times have shown us the need for rationing and saving for the rainy days of life. If we can use this time to teach our children important life skills like financial management, it will surely go a long way in helping them navigate easily through life, in the long run.

1. What is essential and what is not: As adults, we need to be mindful of our own buying behaviour to set a good example. With many regions across the world facing a lockdown, this is a good time to make a list of priority items before going to a supermarket and sticking to that list. Involve kids in making this list by giving them a budget. Teach them how to prune the list to help them see that everything that one wants is not everything one needs.
2. Money should be earned: Involve kids in household age appropriate chores and pay them allowances for the same. Encourage them to use a part of this money for non-essential luxury items (chocolates, toys, etc). Earning money will teach them to value money and the items they buy.
3. A jar for sharing: Sharing, caring and donating is what makes this world beautiful. Let your kid experience the joy of giving early on. While you encourage them to save a part of their allowances, do remind them to keep some money apart for donating to a good cause or perhaps helping out a friend in need.
4. Introduction to banking: You will need to guide and assist children to fully understand the functions of a bank. However, you can slowly initiate them into the basics of banking such as familiarising them with the concept of withdrawing and depositing money.
5. Conscious buying: Buying products that are known to be long lasting and durable is a sure shot way to save a few bucks. An example could be buying classic clothes which are fuss free and easy to wear multiple ways. Let kids indulge occasionally but do help them optimize their purchases regularly.

Let us raise a generation of mindful consumers, smart savers and generous givers!