Helping Children Manage Their Personal Finance

Children are very dear to us. They are part of us that we cannot abandon. We love and care for them and that is why we need to nurture them as kids. We need to teach them how to manage their own finances so as to avoid being in financial crisis when they grow up.
They can easily learn when they are young than when they are adults. It is very hard for a spendthrift to learn how to spend wisely as an adult. Do not let your children grow up like this. Teach them how to manage their finance and you will be happy when you see them prosper. The following are some of the ways these kids can manage their finances.

Let them be their own personal manager.
As a parent you need to allow your kids to manage their money from an early age. It is the only way they will learn to manage it. The best way to do this is by giving them an allowance which should last them a certain period. Make it clear to them that they will not be added any money before the period ends. By so doing, the kids will be able to manage their finance because they do not want to lack something essential because of overspending.  These kids will therefore learn to budget their finance as early as possible. Who would not want this for her kids any way? As you do this, make sure you explain to them the reasons why you are doing this. Some kids may think that you are punishing them by giving them less money; let them understand that it is for their own good.

You can direct them on the relevant books and sites to read in order to improve their knowledge on personal finance. Since some kids are just ignorant not because they are not sharp but because they do not want to think positively, these type of kids may be reached by helping them read these books. The information in it may help them in future.

Advise them on how to resist temptation.
When you have money, it is very obvious for you to feel the urge to spend. It is very important for you as a parent or guardian to teach them how to resist this temptation. Tell them that you cannot always have what you want at all times. When they keep this in mind, they will be able to buy only the necessities. Do not teach your kids to give them what they want whenever they want it. You should allow them to have a taste of the feeling of not having. This not because you hate them, but because you do not want them to suffer if one day they ask for something, that you cannot afford.

As you do all these, do ensure that you make them understand that you are doing them a favor. Do not allow them to feel like you are hurting them intentionally. If you do not communicate this to them, you might lose those kids and the relationship that you had. Kids love their parents and there is no one they trust and believe than them. It is important not to break that trust because you may not get it back for the rest of your life. As you try to teach them how to manage their personal finance, know how to parent also. If you mess up in one do not risk losing the other. Managing personal finance is very easy and can easily be taught to children but if this is the reason why the kids will not listen to their parents then it is not.

Teach them how to protect their income.
Protecting their wealth is one of the ways of teaching children how to manage their finance. You should teach them not to allow other people to take advantage of them. Kids can be subject to peer pressure and would do things not because they want to but because the friends are doing. Personal finance is very important in one’s life. They should not allow these friends to manipulate them especially finance wise.  The kinds of friends who will want you to go for shopping every single day are not true friends. A good friend will allow you to spend whenever you can and not whenever she wants.

As a parent you can protect your kid by keeping them away from these kinds of friends. That is if you want to succeed in your lessons. The kind of friends we hang out with will determine the kind of behavior we have. That is why changing the friends that your kids hang out with could be the best solution for your personal finance management lessons.

Another way to help your kid in protecting their income is by helping them open an account. By so doing, the bank will protect the money for them and also limit their spending. The bank has rules and regulation that need to be adhered to. The kids will not only learn how to manage their personal finance but also learn more about the bank. The terms and conditions of the bank can be explained in simple terms so that they can understand. Slowly by slowly as they grow up they will understand the meaning and be able to interpret them well. The terms may change as they grow up but the meaning of an account will not change.

Keep track of their money
As kids grow up, they should be able to keep track of their money in that they should be able to account for every single cent they spend. Make it a habit for them to account for everything and they will become the best accountants for their own finance. Spendthrifts will never know how to account for their money, am sure you would not want your kids to be these kinds of people. Advise them accordingly so as to avoid such mistakes in future. If these kids are not advised at an early age, they will always be broke even if they manage to secure a good job if future. This is a very risky habit because we all know the kind of things we are capable of doing when we are broke. We might end up stealing not because we are thieves but because we need money to survive. Spendthrifts might clear their salary on the first week of the month. How else do you expect this person to survive the rest of the month?

Another way of the kids keeping track of their money as they learn how to manage their personal finance is by having a budget. At the end of the day, just like a diary, record each and everything that you bought and how much you bought it for. This will help you keep track of your money without wasting any single sent. The reason why it is a good habit to do this is because; you cannot keep a memory of everything you buy in your head for a whole month. Before you forget, record daily transactions and all will be smooth at the end of the month.

Tell them to think of their future.   
When you are young, you tend to think you will never grow up; like you will be a kid forever. Sooner than you can imagine you will turn 18 years. This is the age where, you are supposed to be responsible of your own life. You will be solely responsible for your own actions. It is therefore very important for them to start saving up for their future as early as possible. When they do so, not only will they secure their future but also guarantee themselves a good life in the future.

You as a parent ought to lead by example. You cannot tell your children to think of their future if you are not. Children think their parents are the best and that everything they do is the right thing. Do not let them down by not being a good example to them. If you have a savings account for your retirement, use this as an example in order for them to save for their future. Tell them to open almost a similar account the only difference being that they will be saving from their allowances but you will be saving from your salary. There is no much of a difference because both are trying to manage their personal finances.

The money that these kids save could even help him in his studies in future. You never know what fate has in store for us. It is not guaranteed that the parents will always be there, that is why children have to prepare for anything that happens in the future. It is not good to be pessimistic but let us face it; you never know when your time will come. As a parent you would not want your children to suffer when you are gone. That is why you should prepare them as early as possible.

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