Hi friends, we have already discussed the Tips you can use to teach the concept of money to the age group 4-6 years.
Let’s discuss the various ways to further the lessons to the age group 7-14 years.
As kids reach the age of 7, their understanding if money becomes more sophisticated.
Now is the right time to introduce more complicated Personal Finance concepts.
As the school system does not talk about Personal Finance, it has become absolutely necessary for Parents/Guardians to teach the children these life skills.
Why do we have to teach Children Personal finance:
● It will teach them Material Discipline.
● Financial Literacy will make them confident.
● You will raise Money Saavy kids.
Here are a few Tips to help you teach Personal Finance to your Children:
1● By teaching them Material Discipline.
It means to be able to differentiate between needs and wants. Teach them to save for needs and to not splurge money on wants unnecessarily. Needs can be comfortable shoes or a warm jacket or a sturdy backpack. Wants can be a designer pair of shoes, a designer jacket or a designer backpack.
This will instill in them the discipline to be careful about spending from an early age. It does not mean that they can’t treat themselves to some trendy stuff sometimes.
This exercise will bring about Material Discipline and the children will think and make an informed decision before purchasing anything.
2● Stop comparing.
There is another word for this; Intentional Boasting. As Parents, it is important to teach your kids not to compare with others. This is easier said than done. Children are at a very impressionable age between 7-15 years. It is very difficult to do away with peer pressure. You have to be very patient and teach them by your own actions.
Make them confident by telling them that the grass seems greener on the other side but it is not so. Instead of comparing material objects it is more important to learn skills.
Jealousy is the thief of joy. Instead, run your own race and focus on health, nutrition , hobbies and meaningful relationships.
3● Normalize Money Discussions at Home.
Start talking about how much things cost? How much it costs to run the household?
Parents shy away from Money Discussions with the kids. In fact, this is the right time to discuss income and expenditures. You don’t have to scare them with too much information on finances. Just have a healthy discussion from time to time about the cost of things and intentional spending.
4● Let the kids help you to make the family budget.
Let the kids participate in deciding the family budget. This will help them to understand what has to be prioritized . They will know exactly what can be afforded and what can be avoided.
Tell the Children why you are not buying something even if you can afford it. Is it really required? Intentional spending will instill Financial Discipline in your children and they will avoid making mistakes as adults.
As Parents you can teach the children to be intentional with spending so they can avoid financial mistakes in adult life.
This way you will raise Materially comfortable and financially responsible children.