It is never too early to teach your kids good money habits. By instilling good spending and budgeting habits in your children at a young age, you are preparing them for the future and setting them up for passive income.
Helping them to develop good money habits is fairly simple, so avoid complex lessons until they are older and can understand the significance of money and budgeting.
Give Them an Allowance
One great way to teach your children good money habits is to give them an allowance. This can be weekly, bi-weekly, or monthly. Do not give them an allowance for doing nothing – this can defeat the purpose.
Children benefit from learning that money is earned by working. A kindergartner is able to help with small chores around the house, so put them to work and let them earn their allowance this way.
Teach Them How to Run a Small Business
Another way to earn money would be to hold a lemonade stand in front of the house, or basic yard work or dog walking for your neighbors -with adult supervision. Your child will learn how to market and sell the service or product.
While the idea is to teach good money habits, they are also learning valuable life lessons and nothing sells itself.
Teach Them To Save
Have your children save up their allowance for something that they really want. Whether it is a video game or the hottest new toy on the market, having your child save up for the item will teach them that nothing comes for free.
In return, children also learn that the items you buy them have real value and should be treated as such. This is a great way to teach your kids the value of money.
If your child really wants an item, it is also good to help them meet the value of the toy. For example, they can earn the toy by doing certain chores for a month: keeping their rooms clean, feeding the animals or doing other small chores.
Show your kids the different types of money and coins, bills, etc. and tell them the monetary amount for each.
When you go shopping, let your child have a try at paying certain items. This will help them feel quite grown up and give them a good lesson in money matters.
When you teach your kids good money habits early on in life, it helps to stress the importance of preparing for a financial future. Oftentimes, parents do not instill the proper money management skills into their children, unaware that this is an important life lesson.
It is never too early or too late to start teaching your children how to establish good money habits.