How To Get Your Kids Interested In Money Management
Children? Interested in money?
Yep, it doesn’t sound very easy – and yet it is so important. The earlier they understand money the more they’ll be in control in the future.
Our education is missing a big chunk of financial education, so now it’s our responsibility to make sure they grow up with a good understanding of what these ££ are all about.
I’m constantly trying to get students interested in money. But I’m not giving up; I’ve heard way too many 25+ year olds telling me how much they wished they had learned about money in university.
What if they had learned about it in secondary school or even primary school? We would have much fewer problems to fix. Which is why the sooner you start the better.
So here are some tips to get them started on their journey to ‘financial joy’ at a young age 😉
Get Them Interested
Some people get hooked through different mediums. For me, it was a book: Rich Dad Poor Dad.
Many times, it’s simply talking to them, encouraging them to ask questions and have a conversation about it: ‘No we do not have an unlimited supply of money’, ‘Yes, it’s my work that gives me an income which therefore allows me to buy your toys’.
The basic stuff – making them aware that money exists.
Get Them Involved
The next step is to show them how money affects them and society: explaining to your child how they can get involved.
This could be giving them pocket money and explaining to them what a budget is and how to spend.
Bringing them to the bank and opening an account for them – where they can put in their savings.
Getting them involved means they understand how they take part in all this, and it can be pretty exciting for both you and your child.
My parents did this by making us work every summer holiday. We were fixing up an old house in France, and every year my brother and I would be paid (cough cough way below minimum wage) to paint shutters, rake the yard, do some gardening, cleaning and furniture moving.
The sense of satisfaction I felt when I earnt 50€ in an entire summer! And of course, I didn’t want to spend a single dime. #hardcoresaver
Showing your child how they can earn and spend money at an early stage brings confidence to do so in the future.
This can be through giving them tasks to earn money, making them save up before buying something they want and teaching them the basics of cash flow.
And you’re there to guide them and make sure they’re learning.
Get Them Thinking Long Term
Depending on the age of your child, this may be important or not.
Thinking in the long term doesn’t mean giving them huge responsibilities or taking away their childhood, it simply means being prepared.
This means introducing concepts and systems such as Pay Yourself First – first, save and then spend.
An amazing concept which will assure financial stability for the rest of your child’s life. Teach them accumulation and compound interest, and how it works over the years.
Even concepts such as interest and inflation.
They can also start setting goals: earn X and spend Y. Help them save for something that they really want in the future, which encourages patience and hard work.
Related post: How To Teach Your Kids The Magic Of Compounding Interest
Make It Fun
Of course, everything at a young age has to be fun – and that can still be done with finances. There are many fun board games to get started such as Monopoly or even The Stock Exchange game.
Doing budgets with them can also be fun – make it into a game where you’re not allowed to go over budget.
If they’re a little older, you can introduce them to different finance apps such as Chip, goHenry , nd Osper. They’re easy to download and include activities such as managing a debit card, set goals and even try some investing. The gamification makes it more intriguing.
An even better way to make it fun: encourage creativity and innovation. Teach them how to become a producer, instead of just a consumer.
Help them find something they’re deeply passionate about and guide them on how to produce it, and then maybe even how to market it.
I loved baking when I was a little 12 year old. In fact, I loved it so much that I thought it would be cool to make some actual dough from baking (pun intended).
Next thing you know I’m batch cooking amazing muffins with my mother’s ingredients and selling them at the school for a pricey 2€ each.
And wow did I sell a lot! I even got a friend to help me out and she would get a commission on every sale.
I was doing something I loved, and was very pleased to be making a bit of money on it. It all ended when the head teacher found out and said ‘I wasn’t allowed to sell in school’. Probably jealous a 12 year old was more entrepreneurial than her.
Find that something for your child: maybe it’s art, or interviewing people, or music, or writing, or simply playing video games.
It’s amazing to see how excited they get when the creative juices start flowing with something they love doing, and they feel they’re contributing to society.
I’ve seen it with my own eyes when I used to do a bit of English teaching.
The last bullet point I’d give is to make sure your child builds healthy and good habits.
Those are the habits they’ll keep for life, and will determine what kind of lifestyle they live. This could be as simple as not overspending and not buying every single thing they desire, to getting into the habit of saving every time they earn an income.
The habit of giving and donating time or money is also something that will make them great people as adults.
Starting with habits early on means it’s harder for them to get into bad habits later, and vice versa.
That’s why it’s so important to get your kids interested in money management at a young age.
Finances may sound like a boring subject to teach children, but it really isn’t.
You’d be surprised at how both students and young children literally light up when they start understanding how the real world works.
They make connections between what you’re teaching them and how they can apply it to their day to day lives, which is more than what schools offer them (don’t forget the hypotenuse of a triangle!).
So start slowly and carefully, and soon you’ll see how their self-motivation will take care of the rest.
- Recommended book: Minimalism – Live A Meaningful Life
- 30+ Life Changing Books I Recommend on Money Management
- How Much Money You Should Have Saved By Age
- 10 DAY: FREE Practical Money Management Course
- How To Create A Budget That Works For You
What tips can you offer on how to get kids into money management?
Massive thanks to Araminta for her guest post on The Humble Penny! Check out her bio below:
Araminta is the creator of Financially Mint, a personal finance blog for university students written by an actual student. She interviews experts, does weird experiments and a ton of research to help her and others graduate financially intelligent.
Do please share this post if you found it useful, and remember, in all things be thankful and Seek Joy.