Raising Financially Smart Kids
We are discussing the importance of Raising Financially Smart Kids today. It is very important to train your kids to be financially responsible thus every parent should make this a priority. Having children who are able to make informed decisions about money matters is of great benefit to any parent as you are molding your kids into independent adults who you wouldn’t have to live your whole time worrying about. While Raising Financially Smart Kids you are making them useful to themselves the society, their future families and even to you.
Here are a few tips to make that happen:
Concept of Money in Raising Financially Smart Kids
Start from when they are still young! Begin to explain the concept of bills, investments, opportunity costs, scale of preference, profit and loss, tax payment, savings etcetera. This is not as complex as it sounds. All you need to is to break it down for them in a simple manner. Encourage them to ask questions and listen carefully when they do. Try your best to answer them. Open their eyes to the world of books, especially the ones that teach finances. Educate them on the disadvantages of being financially irresponsible and how wonderful it is to be financially independent.
Visiting the Bank and Raising Financially Smart Kids
When you go to the bank, take them along. In this way they can appreciate how the system works and make the money talks more realistic. Let them learn about the act of opening bank accounts, the different types of back accounts three are, how to make deposits, withdrawals or transfers etcetera. Try to do this as early in the day as possible, before they are born if possible. Make deposits in this account from time to time. It could be slated for their tuition or health. When they are of age, tell them about its existence and encourage them to make deposits too. They could be doing some jobs like walking a neighbor’s dog or babysitting. They should learn to put some of their wages in this account. They could also save a bit of what you give them as allowances or pocket money and also put it into this account. Make it clear to them that they cannot make any form of withdrawal from this account EXCEPT for its original purpose(s).
Educate them about Gainful Employment
You can start this by employing them around the house to trim the garden, do the laundry, that kind of stuff. Supervise them critically and then pay them their wages. Don’t always be in a hurry to give them extra money and let them learn the virtue of spending wisely. When they are a older they can set up educational blogs, or get approved jobs around the neighborhood or even work at the grocery store. It doesn’t matter how well off you are. What you are instilling in them is a sense of responsibility and an appreciation of hard work. Children who grow up feeling entitled are the bane of the society when they become adults. They do not have initiative and they are basically lazy and in some cases, delinquent.
Concept of Balancing the Accounts
They should do this at the end of each week or monthly. By doing this they will learn about their income, expenditures, bills, tax etcetera.
This is the most important factor in Raising Financially Smart Kids. Show them how to make investments in business with good forecasts. Tell them how risky but important it is to make investments for the purpose of a handsome future harvest. Finally teach them how to invest in people, not for personal gain, but to make people’s lives better. Tell them about making donations to charity or making volunteer trips to impoverished countries.