It’s important for parents to teach their kids about the financial values and explain to them what role it plays in their life.
Learning about finances is not something which works with some classes or words. As they say, actions speak louder than words, and in a similar way, money value can be learned well only through practical ways.
Most of the parents choose wrong ways of teaching their kids about money. These small mistakes can affect them for a long time.
Here are some usual mistakes parents make while educating kids about money
1. Starting money lessons during their mid-teens
This is something very common. Usually, parents start money lessons when their kid is 14-15 years old. Parents will pamper their kids by satisfying them with all their wants and all of sudden during their teenage if they start teaching them to save, that may have a negative impact. By the time they have learned it will be late and can make them lose in huge. This should be avoided.
Parents should start their guidance right from the tender age. They should start letting the value of money to their kids while growing. Kids will not learn easily, it would take time and their mistakes will let them learn quickly. So teaching right from a small age will make them learn slowly and by the time of their teenage, they would become an expert in dealing with the expenses.
2. Giving more preference to credit cards
More than the teachings, your regular habits will impact kids more. Kids observe what you are doing. Parents take their kids for grocery shopping and at the time of billing they use their credit/debit cards. Using plastic currency will not let them know how much you are paying. They will just see the card and think we can buy anything with just one card. So, kids get completely a wrong impression.
Using cash will make them know how much you are paying for each quantity. This can make them realize how expensive things are. You can even give them cash and ask them to count. But there can be times where you can’t avoid using your cards, under such circumstances use the cards and try to explain about digital currency in simple terms. But, you tell them what negative impacts can credit cards bring if they are not rightly used.
3. Not letting them know your cash flow
Parents don’t discuss financial matters in front of their kids. They don’t want their kids to know about their earnings or expenses.
Not discussing financial matters in front of your kids will never let them know what are their parents up to. Kids should know how hard their parents are working in order to meet the monthly expenses and how much they are able to save. It is important to make them sit with you during your financial discussions and let them see how you are handling things. It can help them make decisions when they are old. You can even ask them for their ideas and tell them how good/bad impacts their ideas can have.
4. Not letting them work hard
If you go out for a shopping, your kid can be adamant about getting something. And parents either tell them how costly it is or just pamper their kids by getting it. If a kid breaks his toy or a thing they immediately try to replace it with a new one.
Instead of telling them about the cost you can ask your kid to earn money and get the toy. They can help you with some work like laundry, cooking, cleaning the wardrobe etc., and pay them for that. This will help them to know the value of money and even realize whether the toy is worth their hard work or not. Apart from knowing the value of money, they will learn some household works too. This will help them in not being reckless about the toy.
5. Getting a piggy bank
The first thing parents do in order to make their kids save is getting a piggy bank. They force the kids to save.
Forcing kids to save will get them a wrong impression on savings. Never force them to save. Tell them how important savings are and how well savings can help in fulfilling their long-term dreams. Piggy banks can be cute but it will not have a serious impact on kids. Instead of getting a piggy bank, open a savings account in a bank. This will make them a bit serious about savings and simultaneously helps to learn about banking.
Teaching kids about money will not just help them for some time, it will have an impact on their future when they have to run their family. It is important to make kids learn about money and make their own decisions related to money. But make sure you are not forcing them to learn about money. Just make them comfortable and let to learn by looking at you and the way you are managing your finances.
About the Author:
Nikitha is a thesis writer and marketer for MyMoneySouq.com, which is a leading website in UAE for comparison of personal loans, credit cards, home loans, and insurance. Her keen interest towards writing made her choose this creative path. Her articles mainly focus on personal finance and related themes.