Teaching your kids at a young age to manage their money will help set them up for success as they grow into adults.
Teaching your kids at a young age to manage their money will help set them up for success as they grow into adults. Like anything, the lessons you teach when they are young will grow with them as they get older. Kids don’t necessarily need to know all the complex systems that exist early on but there are ways you can teach your kids to manage their money responsibly.
A good method to start with is the Save, Share, Spend, and Show method. Explaining to your kids about how to best use their money in a simple way will make it easier for them to understand more complex money issues in the future.
Save
Helping your kids understand the process of saving money will set them up to use a savings account when they are older. Spend time explaining why you save money. When they make their own money or have an allowance, you can help them save by offering a saving goal. If there is something they want, help them put a little money aside each week for them to use on the goal. That can be a toy or an experience. Showing your kids that saving money over time will offer great benefits in the long run.
Share
Using money for the benefit of others can help prepare your kids to be generous with their money and community. Showing kids how to share their money will help them know where to give their money to be the most helpful. Another benefit of this is showing responsible sharing. When sharing your money, it is important to make sure you do not do so at the expense of your livelihood. Showing your kids how to share their money responsibly will benefit both them and the community in the long run.
Spend
After showing your kids how to save and share their money, allow them freedom to spend the rest however they want. This will show your kids that there is freedom in using money responsibly. That they should set some money aside first to save, set some aside to give, and spend what is left. This gives the child a sense of autonomy and allows them to feel in control of an aspect of their life.
Show
You can teach your kids to use money wisely by doing so yourself. Kids learn habits and choices directly from their parents and guardians. When parents/guardians use money irresponsibly, kid’s learn those habits. When they use money wisely, kid’s gain those as well. Show your kids how to use money by setting an example for them and being honest about how you and your family use money. If you need help managing your money, a Mary Rigg Financial Coach can help you.
The Save, Share, Spend, and Show method allows your kids to learn how to use money responsibly in a simple way and use those skills as they grow. Learning to be financially independent and educated is one of the best things a kid can do for their future.