It is never too early to start teaching your children about wise money habits. These are important skills that they will need throughout their life. But sometimes parents are hesitant to teach their children about good money handling because they don’t feel financially literate themselves. Raccoon Valley Bank is here to help you with these simple lessons to teach your kids about money.
Lesson One: Money is earned
Many parents choose to give their kids an allowance in order to introduce them to managing their own money. This is a good teaching tool. However, it does not teach kids that people must work for their money. Instead of giving a weekly allowance, create a chores list with a monetary value assigned to each item. At the end of the week, award your child with the money they earned for completed chores.
Lesson Two: Saving and giving
When your child has earned a little bit of money, help them sort it into three piles: One for saving, one to spend, and the last to give to a charity. This will teach your kids how to save instead of spending all of their earnings right away. These habits will follow your children into adulthood and help them think through future financial decisions wisely.
Lesson Three: Saving for things we want
As your child saves up their earnings, have them earn something that they really want. Help him or her set a goal and offer them extra jobs to earn more.
It is important to remember that the number one place your children are learning about money and wise spending is from you. Be a good example! Teaching your kids about money management is an ongoing lesson. These are some simple starting lessons that can set your child on a path of wise money management.
April is Financial Literacy Month and Raccoon Valley Bank wants to help our customers get a firmer grasp on what it means to be wise with your money. Please contact us with any questions or concerns you have.