We are living in a highly materialistic society and children think that money gives them the power to buy whatever they want. With all the needs and luxuries being fulfilled, children seldom realise that money should be valued. So, it is the responsibility of the parents to teach their children the real value of money. Therefore, it is advisable to instill in your child the importance of saving money so that she grows into an adult who makes best use of money and spends it smartly and efficiently.
Use these tips to instill in your child the value of money. Discuss the spending capacity of your family with your child. Your child may want you to fulfill all her wishes, to either outshine or match her financial & social status with her friends. While doing so, she may not be able to realize whether her wishes are realistic or unrealistic. Thus, it is your duty to give your child a fair idea of your spending capacity. Also, tell her about how money is earned for the family & who all contribute to the family’s income.
Start giving pocket money: Children tend to control their expenses and also start valuing money when they are asked to manage their own expenditure. So, provide your child with pocket money sufficient enough for her monthly expenses. Consider your child’s age while deciding the amount of pocket money for her. Thus, irrespective of your financial position, provide your child with only that much allowance, which is sufficient for the expenditures that you think are worthwhile for her.
Motivate your child to ‘earn’ money: Instill in your child the quality of ‘earning’ rather than ‘asking’ the money every time he is in need. Inculcate the willingness to work hard to fulfill her materialistic desires. Remind your child that he will get the share of pocket money only if he is willing to work for it. So, indulge in age-specific chores, such as setting the dinner table, cleaning the room, organising the closet, arranging books in the shelf etc. and give monthly pocket money in return, so that he gets a feeling that he has ‘earned’ it.
Motivate your child to save for future: As a parent you need to make your child realise that not all materialistic things are easily affordable every time. It involves a lot of hard work and most importantly, needs savings for the same. For instance, if he wants to buy expensive clothing or a costly toy, tell him that though it is unaffordable, he can probably possess it later on, if he manages to save enough from the pocket money. This will inculcate the habit of first saving and then spending on her materialistic needs and desires.
Teach money management through games: Playing games like Monopoly’, ‘Money Match Game, Business India, etc with your child is a fun way to teach him money management. So, organise such games occasionally at home and involve the entire family. It will teach your child the smart ways to manage money. Also, the hypothetical situations in these games will give your child useful clues for dealing with monetary issues in a real life setting.
Remember that you are your child’s first role model. You need to assume the responsibility of spending wisely and then motivate your child to follow you. Imparting money management skills is a long and a systematic process. At an early age, it will make him money savvy and money smart.
Meenal Arora, Executive Director of Shemrock Preschools & the Founder Director of Shemford Futuristic Schools