What To Tell Your Kids About Money The 7 Essential Lessons

If I had a dollar every time a parent asked me what I should tell your children about money, I would be a millionaire. There are many different types of money management that you can and should tell your children about. Here I will share with you what I believe are the seven most important principles 1. Money may be exchanged for goods or services. This is one of the first lessons you should teach your child when he or she is old enough to understand them - they are usually about 3 years old. The next time you go down to the corner shop to buy one or two items, let your child give the cashier some money. By doing so, they will gain a great deal of appreciation for the idea of ​​being able to exchange money for the things you want or need. 2. One must be careful about money. Some people I know, seem to think that any coins worth less than 50 cents are too small to worry about, so when you clean their messy change in the house, you just have to throw them away. What a waste! Encourage your child to be cautious about all the money items, and show him or her how those small coins can be put together, by starting a small family box. Maybe you can use the money to pay for a small family trip (a trip to the store to get ice cream). 3. Money must be earned. There are many people in the world these days who seem to have never learned this lesson. They stay at home waiting to be offered to survive, or turn to a life of crime to support their existence. Be careful not to give your child money every time he or she asks for it, without expecting anything in return for completing household chores. 4. Encourage one-third savings, one-third donations, one-third spending. The exact amount of money your child spends depends on each family you have to decide for yourself, based on their beliefs and the needs of the child. This can easily be achieved by giving them 3 pig banks or cash boxes - one for spending, one for savings and one for donation. 5. Avoid borrowing money where possible. It is always more difficult to repay what you borrow, than to save your money. Some loans, such as mortgages, are often unavoidable. A good rule of thumb is that if you don’t have the money to buy it, you can’t afford it! 6. Money is not your best friend so don't let it control your life. Simply put, try not to become overly concerned about your finances, until you are forced to work 60 to 70 hours a week to get on with your life. If you do, it means you are letting money control your life. You usually do not need a luxury car (with a car loan) or an overseas vacation (as well as a personal loan). All of these things are great, but only if you can afford them easily! 7. Show them how to make money and live within their means This is one of the most important skills your child should know, most people who don't seem to know how to do it. A recent survey showed that most people spend 10% to 20% more on what they earn. They earn enough money to support their lifestyle, but they do not budget, so they spend a lot of money each week. With these seven lessons under their belt, they will have a good start, but there are many financial skills your child will benefit most from learning. To learn more, visit the Kids Money Tips website.