In order for our kids to mature into adults with healthy financial habits, it is our job as parents to help them cultivate the mindset that will help them to master money and not allow money to master them. As we train our future leaders to make wise financial decisions, here are five do’s and don’ts for teaching kids at an early age about healthy money management.
1. Talk about money openly and honestly with your kids. Do not shy away from these important teaching opportunities. While you do not have to disclose every detail of your financial life, it is necessary for your children to witness your thought process in making wise money choices. It will help them to make better financial choices as well as learn how to be unafraid when communicating with others about money.
2. Get kids involved in family budgeting. A great way to make your kids apart of the cash flow planning process is to have a monthly budget meeting and allow them to participate. This experience can serve as the foundation for your kids learning how to budget and communicate effectively about money when they are adults.
3. Empower your kids to take an active role in the household by earning their own money. One way that you can achieve this is by giving them incentives to earn their own money to pay for extracurricular activities. If they want to be on the dance squad, encourage them to find ways to cover the expense. If your child working outside of the home while going to school is not appealing, they do not have to find a job too far away from home. They can be paid for work that you find for them to do around the house, for neighbors, or for nearby family members. An Internet-based business is a wonderful place for kids to start an income producing business.
4. Don’t leave it up to schools to educate your kids – educate them yourself. You are the parent. Ultimately, it is your job to make sure that your kids have the essential life skills that they need in order to be successful money managers. The buck stops with you; not the local school system.
5. Don’t give your kids everything they want. The world thanks you in advance for not releasing upon society a child with an entitlement complex. It makes everyone’s life easier when our kids know the word, “No” and how to work for the things they want. It is a character builder.
If you want to raise a “money fit kid” who becomes a financially savvy adult, it’s never too early to start teaching them sound financial principles.