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 Raising children has never
been easy. There is so much to teach them and every parent hopes that they
teach their children the right thing. Yet when it comes to money, many
parents aren’t sure which way to turn. This month, I hope to help you set
your children up for success by sharing some tips that have helped many
families master the money issue.Allowances One of the most important, yet frustrating challenges that parents face is how much allowance is appropriate for their child. While some parents believe that room, board and love are adequate allowances for any child, there is a strong argument for a weekly allowance to teach financial responsibility. Before you decide to give an allowance and determine how much is appropriate, it’s important to make sure your children are old enough to count money. This typically includes children age 7 and older. Once you’ve established their ability to count money, it’s important to let your children know what their allowance is for. The Saving Lesson Many children have a hard time conceptualizing how much things really cost. After all, up to this point, Dad and Mom have provided everything they’ve needed and much of what they’ve wanted. To help your children understand how to save, check out children’s accounts with your bank. Many banks offer these accounts at little to no service fee. |
Some banks will even give you and your children a guide to saving, which
explains many of the basic principles. I Want It Now Another problem that many parents have is their child asking for advances on their allowances. While it’s hard to deny them the things that they want, it’s prudent to consider the long-term consequences. All children go through phases of the latest and greatest things they just have to have. If they have to save for the things they want versus getting advances, they learn to appreciate their investment even more. In addition to that, many will choose not to spend money on that item because it eats up too much of their income. While there is an exception to every rule, teaching them to save is a good, long-term lesson. How To Save Children learn by example. Share with them your money- making decisions on some items. For instance, if you’re looking to purchase a new television, you might want to show them how you need to put aside money each pay period to purchase the item. If you elect to buy it with store credit or a credit card, then show them the interest associated with that. As with any parenting decision, there exist different opinions. It is my hope that this article helps you shape your child’s financial future. If can be of any assistance, please feel free to call me. |
