Simple yet effective ways to teach your kids about money

I was stunned to read that your child’s lifelong spending habits are more or less set at the age of 7. Like most people, I would have thought this happened much later. But, according to a recent study carried at Purdue University, 7 is the key age. So, if you want your kids to be good with money you only have a small window of opportunity to lay the foundations. Here are some suggestions about how you might want to get started.

Open a savings account for each of them

The other day I came across an article about the Wealthify junior ISA. It explained that junior ISAs are a tax-efficient way to save for your child’s future.

You can choose between stocks & shares ISAs and one that is cash only. Regardless of which option you decide to use the money you put in is locked away from you and your child until they are 18. So, you know that when they want to learn to drive or go onto further education you can be sure that they will have most of the cash they need to do so.

Set a good example for them

Children learn by example. If you run up debts and buy things even though you can’t really afford them the chances are your kids will do the same. From a very young age, they are like sponges. They pick up on all kinds of things you think are not important to them. 

Teach them not to waste things

Getting into the habit of not throwing too much away and reusing things is a really good way to keep the cost of running your family under control. Your kids will notice this and be more likely to want to do the same. In fact, they will find helping you with things like up-cycling items of furniture or reworking clothes to be a lot of fun. 

If you want to learn more about teaching your children to live frugally, you can do so by reading this article. It contains 4 great tips that any parent can easily implement.

Demonstrate to them the benefits of wise financial habits

Physically demonstrating to your children the benefits of handling money wisely is by far the best way for them to learn. You could for example set up a spending money pot for your next family holiday. They will enjoy watching the money build-up in the jar, especially if you encourage them to contribute. Perhaps they could sell some of their toys online or do chores to earn a little cash for the jar. When holiday time comes around and there is plenty of money available for them to do virtually everything they want, they will likely be sold on the idea of saving up for things.

Give them pocket money

Giving kids an allowance is one of the easiest ways to teach them how to handle money. Once they are old enough they can have a bank account with a debit card and be left to handle their own finances on a small scale.

The above are just a few suggestions. There are lots of other options, all you need to do is to speak to other parents or read a few parenting blogs to uncover them.

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