***Collaborative post***
It’s important to be somewhat competent at managing your financial affairs. It’s not nice having to pinch and save and to live on a shoestring budget, but we all have to do it from time to time (or many do at least), and so knowing those skills, perhaps learning them in childhood, can be very helpful.
As parents, it can be important to teach our children a few financial handling skills, even if it’ll be a long time before they have to fill out a tax return or pay for a mortgage. Furthermore, we don’t have to worry about teaching them the perfect art of running their books, adults learn this according to their situation as they go through life as well. So – what does this mean in practice? Well, like installing Checkout Saver on a browser, saving money should be easy to calculate, well organized, and should be as much of an emotional discipline as much as it is a fiscal art.
Our children can understand those principles through simple techniques. Let’s consider how that might work:
Short Term Patience, Long Term Reward
It’s good to teach your children to hold out in the short-term for them to receive a longer-term reward. This has been tested in a study that showed those who were able to defer short-term rewards for long-term benefits ended up doing better in life. How can we practice this? Well, instead of helping them purchase that video game without a second thought, why not have them save their allowance, or earn extra money through doing chores around the house? This shows them that sometimes, the best things in life aren’t free.
Thinking On Large Purchases
We all have the impulse to indulge and purchase items that we might not usually do, simply because it impresses us and we could ‘possibly’ stretch our money if we tried. It can be nice to think on large purchases however. If your child expresses a real interest in something they walk past in the store, perhaps you can tell them that if they still want it in a month, they can have it. Sometimes, they might forget about it, or have their sights set on something else by that time. This shows them that they can wait, and they can think on their purchases (even if that means being a little more shrewd in what they ask for on Christmas day).
Simple Percentages & Savings
Of course, it’s not easy to teach children how to break down a paycheck, or what their future costs will be as a professional – they have a lifetime to learn this. It can be helpful to teach them what to do with savings though. Perhaps 10%, you could say, is enough to save each time they gain an allowance or money from doing chores. This can help them realize how this adds up over time, and how they begin to plan for not only spending but saving. That can be very helpful.
With this advice, we hope you can teach your children important money-handling lessons, just as they deserve.
