How to teach a child to handle money properly?
How well people know how to handle money depends to a large extent on parenting, so one of the most important tasks for parents is to teach their child to understand the value of money and to teach them how to handle it properly. Often, parents do not pay much attention to it because they think it is one of the things that can be learned simply by looking from the outside, but it is not. Even if the parents are able to handle the money very well and their financial situation is stable, it is not said that their children will learn this skill just as successfully if it is not devoted to time and effort.
The most important thing is to talk to the children about this topic. Many parents, for a variety of reasons, prefer not to talk about money. Some do not want their children to be burdened with complicated stories about cash flow and finances in general, others want to teach their children that money matters are not ethically discussed publicly, but others simply do not have time. Whatever the reasons, parents need to know that in this way the child’s money is misunderstood from an early age. Because children do not earn themselves, but only receive money and the necessary things from their parents, they do not understand where the money comes from. Children grow up with confidence that money is self-evident and when they themselves have to start earning and spending money, it can lead to excessive waste because there is a lack of understanding that money may not be.
The best method is also to show the child cash flow from an early age. Of course, the child will not work for a paid job, but parents can pay ‘wages’ for help in various jobs. Basic things must also be provided to parents, but the child can earn money for toys or other coveted goods. In this way, the child will at least understand that the money does not grow in the trees and if you want to buy something, you have to work hard to get it. This method has to be a bit careful though. The child must not be paid for all the work. It must be understood that he also has his own responsibilities, such as arranging his own room, caring for himself and helping with some of the housework that no one will pay for. You can pay for extra works, such as gardening or some larger home works.
Most likely the child will want to spend all the money received or earned on some long-lived goods. You can let him do that, but you should also learn to save and save money. Allow to buy items only if the pair is left with some money for other things. Explain why you should not spend all the money. This is often a challenge for many adults, as the temptation to buy different items is very large, but it is also necessary to leave money in the reserve. If you teach it to your children from an early age, they will most likely not be wondering why they should make savings and why not buy everything that the heart desires.
When children go to school, the occasional pocket money or “wage” for the work done is replaced by lunch money and possibly money for other spending. Often, parents look very hard at spending the money immediately and even paying money every day to avoid it, but still have to let the child handle the money himself. This will best understand the principles of accounting and personal budgeting. Just as adults receive money once or twice a month and then plan how to spend it, the child also needs to let this system enjoy their skin. If all the money is spent right away, you will have to suffer and think how to live the rest of the month. Sounds harsh, but it is precisely this kind of life training that makes it possible to understand how everything works. Of course, parents should not let everything go away. Whether or not it succeeds, however, needs to be monitored and advised if necessary.
However, it should also be remembered that empty speaking and teaching will not bring anything. There must also be an example for your children. If the parents themselves crossed the money, they would buy everything that the heart desires and even take out loans to make enough money, and the child would probably grow up with confidence that money should not be saved. If what you say and teach will not go with the action itself, then the teaching will not make sense, so start with adjusting your financial situation.
If you follow all the suggestions and teach your children what money is and what they value, you will do a great service for them. It is the understanding of the money that has already arisen in childhood that determines the future financial situation.