Teaching children the value of money is something that I think about a lot. It is so important to help them to understand how important it is to have it, to save it and that they do not really need to spend every last penny in their pockets on more plastic rubbish. But how do you do that? Today I have a guest post from the debt management agency Gregory Pennington to give us all some tips on where to start.
Money is one of life's most important subjects. Earning it, spending it, saving it: these things have a big influence on our day-to-day lives.
And yet, learning to manage our money is something we largely pick up through trial-and-error. As parents, the better we can prepare our kids, the less (hopefully) they'll have to learn through bitter experience when they're grown up.
To get you started, Gregory Pennington has compiled these tips to help you tackle this big subject on a child-friendly level.
Set a weekly allowance
One of the best ways to teach your kids the value and importance of money is by letting them make their own mistakes - and this means letting them handle their own money while they're still young.
Why not give your children a set allowance, so they can learn how to save, budget and keep track of their own finances? Of course, it's important to give them some advice along the way, but don't forget that we can learn as much from our slip-ups as from our successes - so giving them a bit of financial independence really could go a long way.
Highlight the importance of work
Money, alas, doesn't grow on trees. Therefore, it's crucial to show your kids at an early age that hard work, responsibility and ambition are generally the keys to financial stability in the future.
Whether you give them a bit of money for doing household chores (e.g. washing up, mowing the lawn), encourage them to take up a paper round or, once they're a bit older, get a part-time job, the sooner your kids can experience the working world, the better prepared they should be for the years ahead.
Teach them about debt
Borrowing a bit of money can, in some cases, be very useful. However, getting into debt is always something of a risk for a borrower's finances - especially if they find they can't repay what they owe.
With this in mind, you should teach your kids the importance of saving up for the things they can't afford straight away - so they know they can safely afford them.
If they're old enough to understand interest, giving them a few practical examples of how debt builds up can go a long way.
Take them to open their first bank account
Kids can open their first bank account at 11 years old - as long as they have parental permission. So, when you get some spare time, why not take your kids down to your local bank branch and get them to open a current account? That way, they can start paying money in, using things such as internet/text banking and keeping track of their money the 'adult' way?
This is a sponsored post.