TEACHING YOUR CHILDREN MONEY MANAGEMENT

"Have you ever sat your child down and talked about the value of money? Have you explained to him/her that one should never spend more than what one earns? Have you taught your child how to save?" If you answered "no" to all or most of these questions, chances are your child will grow up and learn how to be a credit card junkie, and live like over half of the U.S. Population: "Paycheck to Paycheck".

"The earlier you start, the better. The simplest way to introduce young children to numbers is to have them count coins, crayons, toys, fingers and toes, or any object that will hold their attention long enough. 

Once children feel comfortable with numbers, it is time to teach them how to use money to get things they want. Bring your children on family shopping trips, and have them pay for small items - coloring books, candy bars, small toys - from money you have given them for that purpose. In addition to learning how to count their change, your children will learn the purchasing power of their money and the relative value of the items they choose to buy. 

A child's first year in school is about the time he or she should be receiving a regular allowance, and with it an ongoing and self-taught course in how to spend, budget and save money. How much allowance is enough? Ideally an allowance should cover a child's routine expenses - bus fare, lunch money - with a little left over for some, but not all, youthful diversions. There should be a clear understanding of what the child is expected to pay for out of his or her allowance. This way, a child learns to budget for those things he or she wants most."

Teaching your children to save and budget is a daunting task if you have never learned yourself. If this is the case, send yourself out to the bookstore and start reading some of the books on the subject. Most of it is common sense and a good dose of prudence. Once you learn the drill, sit down and figure out a way to make fun, challenging and engaging activities to teach your child about this topic. Learning how to manage money is a gift you can give your child that will serve a purpose for family generations to come. 

Source: Better Investing and Essortment