5 Tips for Educating your Children about Money
27th September 2014
Although we may not like to believe it, money does make the world go round and the older we get, the more we come to realise just how important it is. Yet shockingly, children are not taught any money management skills at all, throughout the whole of their school years. So in order to prepare your children for their ever imminent adult lives, it’s up to you to take charge and start teaching your child a thing or two about finances. However, that’s not to say you should jump into teaching your 5 year old about the world of mortgages.
You need to start at square one and teach your children basic money handlings skills suitable to their age, to help set them off of the right foot in life, so when the time comes that they start earning a wage and owning credit cards (albeit a scary thought!) they will be well educated and it won’t seem quite as scary.
3 -5 year olds
Aim: You have to wait to buy the nice things you want.
Buy your child a piggy bank and encourage them to put money in it, for instance, if they receive any birthday or Christmas money or if they get money for helping out around the house. Then every so often, they can empty out the contents and count up to see how much they have saved. Hopefully they will be impressed with their savings and this will instil good saving habits.
If there is a toy your child wants, rather than just buying it for them, help them set up a realistic savings plan e.g. saving £2 a week and this will teach them that they have to earn and wait for something you want.
6-10 year olds
Aim: You need to make wise choices when it comes to your money.
Now your child is a bit older, they need to learn to make wise decisions when it comes to money. Take your child with you when you go food shopping and explains to them why you are choosing certain brands over others e.g. This loaf of bread is practically the same as this loaf of bread, but it is 30p cheaper so we’re going to to buy the cheaper one and save some money.
Give your child some money and let them buy a small item themselves. This will show them how much they can get for their money, giving them a sense of how long you have to save to buy things. Also, let them count their change and check they have been given the right amount.
11-13 year olds
Aim: The quicker you start saving, the quicker you can have the things in life you want.
Now they should have an awareness of how money works to buy items, they can start to learn about how savings works.
Begin to explain to them what interest is, and if they were to save X amount a year, they could earn X amount of interest on top of that, simply by saving their money into a bank account.
Also try and get your child to understand how much money they could potentially save, and the benefits they would receive from that. For instance, if they save X amount in one year, by the time they are 25 years old, they would have accumulated X amount, and this could buy them a car, for example.
This will hopefully give them an incentive to want to work hard to be able to comfortably afford luxuries in life!
There is no time like the present and starting as early as possible will only benefit your children more. Teaching them these skills will help them learn valuable skills about money management, in terms of budgeting and saving. These are skills they can use throughout their life and will help them to make sensible decisions with their money.
Here at Tiny world, we have over 30 years’ experience in caring for children from 6 weeks old, through to 11 years old. We strive to create a friendly, relaxed and happy environment for your children to play and learn, feeling safe and at home in our care. Please feel free to contact us if you’re searching for nurseries in the Mansfield and Basford areas of Nottingham.