Teaching kids good money habits
Good earning habits do not arise automatically in adulthood, they arise in childhood. Take a look around and see adults of all ages messing up their finances. But what if they had learned good money habits as children?
At school, we study algebra, calculus, and trigonometry, but we don’t learn to budget, save, or invest. The older we get, the more responsibilities we have that make it difficult for us to focus on studying financial principles.
I founded Rich Single Momma because I wanted to teach single moms how to raise money. Ultimately, this education evolved into financial literacy and financial empowerment. After helping over 2,500 adults with their money problems, I naturally began to emphasize the importance of parents teaching their children about money.
I spoke with several parents and money experts from the wealthy single mom community who shared their tips and experiences in teaching kids good money habits at every stage.
Babies and toddlers
How to teach kids good money habits? They are busy learning the basics of eating, sleeping, walking, and relationships with the world. It may seem like a waste of time, but it all starts with the first cash gift they receive at birth and / or every year thereafter.
Babies are stimulated by color and sound, so ask grandparents and relatives to buy cute musical piggy banks. Children love to put money in a music bank just to listen to music or watch the kitten take a coin. Make depositing money a daily or weekly ritual to develop a saving habit. Later, transfer the money you save to your child’s savings account and continue the habit of investing in your home bank and then depositing into your savings account every month.
Pre-K and younger students
Young children are naturally interested in the world, so now is the perfect time to teach them good money habits.
Create a toy store with prices for your own toys. Let them use the change from your change jar to buy toys from you. Increase prices and the amount they have to spend as they get older. Equip them with a pencil and notepad to calculate the price so they don’t go over budget.
You may also consider introducing a benefit at this age. One of the parents, Stephanie Stockwell, said: I started receiving the au pair for my son, 6 years old. He can earn $ 0.25 for various chores. We also let him choose a target for his money. After he reaches 1.5 times his goal, if his goal is $ 10, he needs $ 15 and he can choose to buy.
As more and more parents are homeschooling their children, this opens up an opportunity to teach them good money habits. From financial literacy sheets you can download to watching other kids talk about money on YouTube, learning good money habits can be fun and engaging.
Children will learn more and are likely to be more receptive as they get hands-on experience at the grocery store, shop online, or go to the bank or ATM. These are all instructive points that parents can use in their daily life. Jolie Wiguers shared, “My kids use a little app called Spendee to record all transactions. They need to check their transactions with their bank (which is not connected) before they receive the next month’s benefit!
Another tool that many parents use is Greenlight, which offers kids a parent-managed debit card. With the Greenlight app, parents can fund their child’s account with benefits after doing chores (it is possible to top up without chores). The kids can then fund their savings, spend, or open accounts.
The teenage years are the dawn of independence, and a time when many teenagers are starting to find ways to make money by working or negotiating higher benefits. This is the perfect time to reinforce good money habits. When daughter Karen Colton was 13, she began planning a vacation with her mom. Karen often found an inexpensive short-term apartment when they traveled.
She says: My daughter helped with planning, including budgeting. By the age of 13, she was already a professional. Once we unexpectedly arrived in Bruges, and she offered to find us a place to sleep. We left her at the phone booth with the tourist accommodation guide she got from the tourist information center and when we returned to find that she had booked us a cozy apartment that fit into our budget.