“Teaching kids about money is never just about money” - Dave Ramsey
Enlightening kids about money lessons is an all time challenge for parents. Children learn about money habits from their parents. So, parents must start to teach good money habits to their kids at an early age. It’s also their duty to make them understand the fine line that differentiates a good money habit from a bad money habit.
Can you train your kids about money lessons in a fun way?
Creative and colorful things always attract kids. There isn’t a perfect age to teach kids about money. But, the learning process must be interesting that’ll fascinate your kids. There are various enthralling ways to make your kids learn about money management.
According to Jayne Pearl, author of Kids and Money Guide to Learning Capital, “The topic of money shouldn’t be something that’s taboo.”
Just take a look at the below-given points and discover some fun ideas to teach your kids about money :
1. The envelope rule - If you are an earning member of the house, then you must be familiar with the envelope rule. In the envelope rule, money is kept in separate envelopes for different uses. Label envelopes so that your dollars don’t get mixed up. For instance, if you keep money separately for different uses, then the money that is kept for buying groceries won’t get mixed up with the one kept for paying electricity bills.
Teach the envelope rule to your kids. You can use jars instead of envelopes. Use colorful jars and envelopes to increase your kids’ interest in taking money lessons. Tell your kids to draw pictures on the jars of what they want. Then, ask them to save money in the jars for buying those things. Explain to them about short-term and long-term savings. This way, your kids will understand the value of saving money.
2. A savings planner - Colors and stickers always tempt kids. Create a savings goal chart/planner with a colorful chart paper. Make a list of those things, which your kid wants to buy. Now, tell your kid to save money for buying those stuff. Tell your kid that if he/she saves a particular amount (say $2) within a certain period (say within 2 weeks), then you’ll give him/her’s favourite stickers as a token. This’ll surely motivate your kid to save more money.
3. Money magnets - Don’t you use different types of magnets to decorate your fridge? Why not use a money magnet this time? Teaching kids about money lessons using money magnets is a fascinating idea. Next time your kids want chocolates, ask them to pay for them. Tell them to pay a magnet coin in exchange for a chocolate/a glass of juice. This way, they’ll understand that money is required to buy things.
4. An assortment test - Kids love to sort things out. Give them coins of different sizes. Tell your kids to assort the coins according to their size and make pillars with them. This’ll make them understand the difference between pennies, nickels, dimes, and quarters.
5. Play games - Children love to play games and puzzles. Get a money puzzle for your kids and tell them to solve it properly. This’ll help them to figure out how the US dollar looks like. You can also buy business games for your children to make them understand the usage of money.
You can also take the help of board games to make your kids know what is money management all about. For example, The Game of Life teaches children about the various expenses they’ll incur during their journey from college to retirement. With the help of technology such as the gaming apps, you can easily teach your kids about money lessons. For instance, The Game is an app for the iPad and iPhone that enlightens your kids about the difference between wants and needs - an acute financial lesson.
According to Susan Beacham (CEO and co-founder of Money Savvy Generation in Lake Bluff, Ill., a company that helps parents and educators teach children to make good money choices), games are an excellent tool for approaching the topic of money with kids. She says, "Games become something you can use to open the discussion, so it's not always you preaching about money."
Boost kid’s confidence by giving rewards
“The reward of a thing well done is to have it done” - Ralph Waldo Emerson
Rewards always make people happy. Receiving a reward for one’s hard work is like achieving a milestone. It gives recognition to a person’s work. You can also apply this concept of “rewards” for your kids. This’ll give a recognition to their work.
While teaching your kids about money lessons, give them rewards for adopting good money habits. It’s not necessary to give expensive gifts always. You can reward your kids’ financial activities in other interesting ways too. Find out some delightful rewards to make your kids happy:
- Give reward points - Tell your kids that if they save a certain amount per day, then you’ll give reward points to them. Also, tell them that you’ll be deducting points if they don’t save money. Here, the fear of losing points will make them save more.
- Gift a token - You can also gift tokens to encourage your kids to get engaged in financial activities. It can be anything such as your kids’ favorite sticker, a dress or a game they want to buy, a treat at their favorite food joint or an ice-cream parlor and so on.
- Maintain a report card - Just as a school maintains a report card for students, you can also maintain a report card for your kids’ financial activities. Tell them that you’re keeping a record of their actions. Mention to them that you’ll be giving grades for their good money habits. You can give them smilies or cook their favorite dish if they get good grades. This’ll increase their excitement to embrace more good money habits in their lives.
- Say a word of recognition - Material things don’t always matter. A word of recognition also acts as a confidence booster. If your child is trying to save money, then you should say few words to encourage him/her. You don’t always need gifts to crown your child’s success. Few words of praise can inspire your kids more than those material gifts.
A final lesson
“A penny saved is a penny earned” - Benjamin Franklin
Teaching your child about finance is not at all an easy job. This is monotonous and tedious. Use different fun and creative ways to make your child understand about money and it’s usage. Give them some time to understand your financial lessons. As parents, it’s your duty to show them the right path so that they don’t face difficulty in handling money when they grow up. Educating kids about anything is tough because they’ve lots of queries regarding everything. It’s parents’ responsibility to solve each and every query of their children.
I will advise you to keep calm even if your child irritates you with his/her questions. First, ask yourself how you want your child to grow up, then sort out things in your own way to make him/her understand. Do things differently that’ll make your kid cheerful and delighted. And most importantly, always try to encourage your kids if they do something good, this will boost their confidence and make your kids happy.
Don't miss out - Even your dad’s money mistakes count: Repeating can cost you big
