What To Teach Your Kids About Money

teach kids about money

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There comes a time in each child’s life when they start to want to buy their own things themselves. This might be through the money they have earnt in a part-time job or from their pocket money. You should use this time to teach your children about money. They need to know when to spend and when to save and the importance of using money smartly. With that in mind, here is what you should teach your kids about money.

Teach Them About Spending

You should also teach your children about spending. They need to understand that money is a limited resource and that once it is gone, it is gone. This can be taught having a money pouch on a day out with your child, and as you buy things throughout the day, this will steadily run out of money. At the end of the day, when all the money is gone they can see that there is no more money even if they want to buy more things. Obviously, this is simplified for a very young child and won’t be appropriate for teenagers.

Children need to learn that eventually, they will need to be able to manage their own finances. A good way of teaching this is through setting a set allowance or pocket money and sticking to that figure. If they spend it all, then it is all gone. They need to learn the consequences of their actions and understand that the bank of Mom and Dad won’t always be there to catch them. If they don’t have money, then they might need to do things like take out a small loan if they desperately need money and you don’t necessarily want this to be the case when they grow up.

Teach Them About Saving

You should teach your children the value of saving money as early as possible. The sooner they understand the benefits of saving money for later, the better it will serve them through their lives. This will help them understand that they need to save money in order to purchase expensive items and that it is worth having some money set aside for times when they want it. A good example of this is if your child wants an expensive video games console, then encouraging them to save their pocket money and once they reach a certain amount you will also make a contribution will help them see the value in saving. Another example would be encouraging them to have a savings fund for when they go holiday so that they can enjoy more ice cream, activities and other treats. These are great ways to show your children how important saving can be and the rewards of doing so.

When they get older, this will also apply to understanding how savings accounts work. If they understand that interest means that their money will steadily grow without them needing to touch it and that the more they save, the more money they will have, then they are more likely to have good saving habits in the future. This will help them to save money for a house, education or anything else that they want to save money for. Teaching them that the sooner they start saving, the better is also worth doing.

Saving Money with Kids: Is It Possible?

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If you have children, saving money can seem impossible. How are you supposed to save cash when you have extra mouths to feed and extra demands to meet? Well, while it may be difficult, it can be done. Read on to discover some great tips on saving money as a family.

  • Focus on paying off your debts – Paying off debts can be a challenge when you have children. It takes the back seat because you have so many other expenses to tackle. However, being in debt results in further expenses because you’re going to be paying interest. So, the best thing to do is put a plan together to pay off your debts. Use a debt consolidation calculator to determine whether this would be the best solution. Otherwise, put together a structured plan so you can work out how much you can afford to comfortably put towards your debts every month.
  • Take advantage of cheap family travel – Make sure you explore your travel options carefully. If you use public transport a lot, buying a railcard may be a wise idea. You could save 1/3 off family train travel by investing in a railcard.
  • Shop better – Most families will agree that a large chunk of their monthly spending goes on groceries. So, now is the perfect time to learn how to shop more effectively. Take advantage of the value ranges that are offered by supermarkets. Also, buy in bulk and make a shopping list before you go to the supermarket. A few small changes can go a very long way when trying to save money.
  • Make the most of vouchers and coupons – Nowadays, there seems to be a voucher and coupon for everything, so make the most of them. You can also use special childcare vouchers to save money in terms of tax. Make sure you explore all of your options carefully. A lot of parents are missing out on savings without even realising it.
  • Opt for free family fun – There are plenty of ways for you and your family to have fun without spending money. If you do a quick browse on the Internet, you will see that there are many free attractions, or venues where children go free, which will make your days out a lot more cost effective.
  • Make sure you’re not paying too much for council tax – There are many homes that are in the wrong council tax In fact, this has been the way since 1993. This means you could be paying way too much money for your home’s valuations. Not only this, you may also be owned a significant amount of money too, and so this is definitely something that is worth exploring future.

So there you have it: some of the best ways to save money if you have children. While it can be incredibly difficult, it is not impossible. Follow the advice that has been mentioned above, and you will soon notice that your money starts to build-up.