Whether you like it or not, one day, your kids are going to grow up and start doing things on their own without your help. All parents know this and so you try to teach your children valuable skills. But oftentimes, it’s easy to forget or not know how to teach money lessons to kids.
Luckily, we’ve got you covered. Keep reading if you want to learn more about how to teach your kids about personal finance.
Start the money lessons early
You should keep in mind that it is never too early to start teaching your kids about managing their personal finances. Kids learn by imitating everything they see you doing, so it is crucial for you to set good examples for them to follow.
You don’t have to have serious conversations about money with your kids if you don’t want to. You can start simply by making up fun, money related games. For instance, give them some Monopoly money and ask them to buy the things they need, from you. This will teach them the importance of money and how to use it.
Teach your kids how to save money
One of the most important money lessons you need to give your kids, is about the importance of saving money. It is your responsibility to teach them that if they want something, they’ll have to save money for it.
Encourage money saving by getting a piggy bank and asking them to put a part of their pocket money or gift money into it. If you’re out grocery shopping with them, teach your kids how to get the best value of money by comparing prices, and looking for discounts.
Set a budget
You can start teaching your kids about budgeting, as they enter their teenage years. Begin by helping them create a monthly budget and talk to them about the consequences of going over the set limit. You can also encourage them to get a part-time job to earn their own money.
Knowing the difference between needs and wants is crucial since it will help them in sticking to within their budget. Give them examples from your life to make them understand this difference better. Saving money sets a good life-long habit that will follow them through life and retirement.
Get savvy with apps
Most parents already know that kids are more tech-savvy than them, but what they don’t know is how to use this fact in their favor. There are many apps available for iOS and Android that can help to teach your kids some money lessons.
There are apps like Savings Spree, Renegade Buggies, Bankaroo, Celebrity Calamity, and many others, that can teach your kids about financial literacy in a fun and interesting way.
Insurance planning and its importance
Along with teaching your children about handling their finances, you should also tell them the importance of having insurance and the different types of insurance coverage available.
Young people often tend to take life insurance lightly and think they don’t need it. Talk to them about what it means to have life insurance, and what it is used for. Give them examples of relatives who have passed away and how life insurance helped them.
Talking to children about money may seem daunting, but it is something that cannot be avoided and is an important part of parenting. Emphasize the importance of saving money from an early age, since the earlier you start, the better are the long-term results.
Tell them all about where money comes from, how to save money, how to budget, how to spend by staying inside your budget, and how to get insurance coverage.