Kids can be taught the value of money management as early as pre-school age. They are already cognizant that money gets them what they want and the role it plays for immediate gratification. However, receiving gifts of money from grandparents and allowances from chores performed often accumulate with little to no plan for the funds at all. For the child, it could translate to an untouchable savings balance or a thrilling trip to a candy or toy store. Maintaining frequent dialogue with kids about financial matters will yield a healthy and sensible understanding of money. Kids should be involved in activities and assignments that center on money management. Opening a savings account is a great way to begin a child’s financial education. Remember to establish written goals for the account and designate a special financial notebook, poster board or computer file to track financial progress and stimulate a healthy attitude towards saving and investing. Show kids the receipts from shopping excursions and evenings dining out. Creating an expense chart using all food receipts will teach record keeping skills and usher in awareness of real life costs of existence. Other great ideas include allowing kids to manage and track their own lunch money at school. They will learn to budget properly and fortify their math skills. Children should be allowed to visit the bank regularly and maintain records of account activity each month with regular review of statements and any other receipts. Allowing kids to deposit and withdraw money personally will make visits to the bank a more exciting and personal activity. Design home projects with kids to chart money saved and interest earned in bank accounts.
Make sure to include foundation principles of saving, planned spending and charitable contributions in your discussions with children. Help them understand that money management is something with which everyone can and should participate. Conducting regular financial planning activities will foster a healthy relationship between children and money matters on all levels. As with anything in life, familiarity brings comfort, which in turn makes the content easier to manipulate. Helping children to obtain financial security will enhance their lives tremendously.