Ask a five-year old where money comes from, and the answer you'll probably get is "From a machine!" Even though children don't always understand where money really comes from, they realize at a young age that they can use it to buy the things they want. So as soon as your child becomes interested in money, start teaching him or her how to handle it wisely. The simple lessons you teach today will give your child a solid foundation for making a lifetime of financial decisions.
LESSON 1: LEARNING TO HANDLE AN ALLOWANCE
An allowance is often a child's first brush with financial independence. With allowance money in hand, your child can begin saving and budgeting for the things he or she wants.
LESSON 2: OPENING A BANK ACCOUNT
Taking your child to the bank to open an account is a simple way to introduce the concept of saving money. Your child will learn how savings accounts work, and will enjoy trips to the bank to make deposits. Let your child take a few dollars out of the account occasionally. Young children who see money going into the account but never coming out may quickly lose interest in saving.
LESSON 3: SAVING FOR FINANCIAL GOALS
When your children receives money, you want them to save it for college, but they'd rather spend it now. Let's face it: children don't always see the value of putting money away for the future. Young children may lose interest in goals that take longer than a week or two to reach. And if your child fails to reach a goal, chalk it up to experience. Over time, your child will learn to become a more disciplined saver.
LESSON 4: BECOMING A SMART CONSUMER
Commercials. Peer pressure. The mall. Children are constantly tempted to spend money but aren't born with the ability to spend it wisely. Your child needs guidance from you to make good buying decisions. Set aside one day a month to take your child shopping. This will encourage your child to save up for something he or she really wants rather than buying something on impulse. Let your child make mistakes. If the toy your child insists on buying breaks, or turns out to be less fun than it looked on the commercials, eventually your child will learn to make good choices even when you're not there to give advice.
LESSON 1: LEARNING TO HANDLE AN ALLOWANCE
An allowance is often a child's first brush with financial independence. With allowance money in hand, your child can begin saving and budgeting for the things he or she wants.
LESSON 2: OPENING A BANK ACCOUNT
Taking your child to the bank to open an account is a simple way to introduce the concept of saving money. Your child will learn how savings accounts work, and will enjoy trips to the bank to make deposits. Let your child take a few dollars out of the account occasionally. Young children who see money going into the account but never coming out may quickly lose interest in saving.
LESSON 3: SAVING FOR FINANCIAL GOALS
When your children receives money, you want them to save it for college, but they'd rather spend it now. Let's face it: children don't always see the value of putting money away for the future. Young children may lose interest in goals that take longer than a week or two to reach. And if your child fails to reach a goal, chalk it up to experience. Over time, your child will learn to become a more disciplined saver.
LESSON 4: BECOMING A SMART CONSUMER
Commercials. Peer pressure. The mall. Children are constantly tempted to spend money but aren't born with the ability to spend it wisely. Your child needs guidance from you to make good buying decisions. Set aside one day a month to take your child shopping. This will encourage your child to save up for something he or she really wants rather than buying something on impulse. Let your child make mistakes. If the toy your child insists on buying breaks, or turns out to be less fun than it looked on the commercials, eventually your child will learn to make good choices even when you're not there to give advice.