Bringing Up Your Children to be Good with Money

Most parents want their children to do well at school, to have lots of friends, be good at sport, get a good job, get married and produce lots of grandchildren. There’s many an hour spent looking for after-school activities, piano teachers and shin-pads, but not quite so many spent on developing good financial skills and knowledge. One of the foundations of a happy and successful life is avoiding serious debt problems, so take a look at this website and get some ideas about teaching your children about money. Here are some more ideas for you to get started on now.

Make a pretend shop

Children generally start to count and understand numbers at around two or so. They also love to imitate adults around this age so they’ll have seen you shopping, handing over cash or a card in exchange for goods and they’ll love it. Bringing in a pretend shop, complete with a till, pretend money and the ubiquitous wooden aubergine, is a great way to start them off. You come to their shop with £3.00, buy an aubergine and a bar of chocolate and they give you 50 pence back.

Then take them shopping for real

When they’re a bit older, they can take some real money to a real shop. Find a friendly shop with indulgent staff and head there once a week or so. Armed with a whole pound, your child can decide what to buy – a bag of sweets costs 45 pence so they get 55 pence back. Do they save that 55 pence or spend it on something else?

Start giving pocket money

Once children are school-age, they can start receiving and looking after pocket-money. It doesn’t have to be a huge amount – a pound or two will do – and it should be given freely, rather than in exchange for chores. It’s important for children this age to learn that housework has its own rewards – not just monetary ones…

Saving and sharing

Learning how to save money is very important and it’s not just about stashing coins in a jar, either. Your children’s “income” should be looked after by them. They should learn how to divide it up into different “pots”, literal pots work best at this age. There’s money for spending, money for saving and money for charity and so you should give your children an amount that’s easily divided into three so each week, they put an equal amount into each pot. This teaches children that their money is a tool – they can treat themselves and help their local animal sanctuary with it.

The first bank account

Having their own bank account will make your child feel like a real grown-up! It’ll also make saving up for a really special toy or book more possible, especially if Christmas and birthday money goes into it as well. It’s now that you need to teach your child how to check their bank balance and also about compound interest.

Start paying for chores

Once they hit seven or eight, your children can start washing the car, folding laundry and cleaning out the guinea pigs. Only pay up once the job is done to your satisfaction. This teaches children that they have to earn their money and take pride in their work.