Money is very important in our lives. Although our kids don’t have to worry about money as much as we do yet, it’s never too early to help them understand its importance.
Why do we have to do this, you ask? Can’t we wait for them to realize this on their own? To answer that, consider these facts:
- Many of us are in debt.
- Most of the world’s population is in poverty.
- People often waste their hard-earned cash in trivial things and unsound investments.
Surely, these grownups would have learned their lessons by now?
Let’s accept that we have made a lot of mistakes because we didn’t start managing money wisely as soon as we can. Hopefully, our children will do better than we did. But, we have to do our best to guide them well.
Some quick Q’s and A’s:
Q: When is the best time to teach kids about cash?
A: As soon as you are able.
Q: What is the earliest time that a child is ready to learn about it?
A: When he/she can already count.
Money involves math. If your child knows how to count and perform simple addition and subtraction, you can show how money works.
Take him or her with you whenever you buy stuff. Explain what is happening. For example, while you are at the cashier, tell him/her that you are giving your money to the cashier so you can get what you want to buy. Point to the numbers printed on your cash and also to the price tags of your purchases.
Describe how the world works in simple words. Say that things cost money, and the more money you have, the more you can buy. More importantly, warn them that having no money means not being able to buy what you need.
Let them pretend that they are the ones who are buying stuff. You can role-play for this or let them buy on their own. Give them a limited amount of money and make them select what they want to purchase. They will realize that they can’t get everything.
When they get the idea that money is limited, teach about the importance of making smart choices with their available cash. Here are some pointers for this:
Help them identify their priorities. This is essential not only for managing money well, but also for making wise decisions in life. Make them think about what’s really important for them to have, and what they can let go of in favor of those important things.
Listing advantages and disadvantages of purchasing something will help with decision making. This develops their skills of evaluating objects and situations, and estimating the outcomes of their choices.
Money teaches us a lot of good things – values, priorities, responsibilities, foresight, and self-control. Remember that kids learn fast while they are young. Seize every opportunity to teach them excellent money management skills that they will carry on for the rest of their lives.