Money is one of life’s most valuable commodities, so it is important to develop good saving skills from a young age. Try these simple tips to help educate your kids about money.
Almost one third of all personal insolvencies in Australia last financial year occurred among people aged 35 and under. More obviously needs to be done to educate young people about money management and debt, and the best place to start is at home.
Here are a few helpful tips to get your kids thinking about investing in their future:
• Have an allowance scheme: Rather than buying your children items on demand, give them a small sum (say $10 to $15) each week to manage. This will get them working to a budget (and you won’t always feel like their personal ATM).
• Create a savings account: Open a savings account for your children with a passbook rather than a card, as this will make it more difficult for them to withdraw money once it has been deposited.
• Talk to their school: Find out from your children’s school whether it has a money education program and see how you can help your child put these initiatives into practice at home. For example, the Commonwealth Bank offers a program called ‘StartSmart’ for primary and secondary school children to educate them on the importance of saving.
• Encourage your child to get an after school job: If your children are at an eligible age, encourage them to get an after school job with minimal working hours. Not only will this give them a sense of freedom and independence, it will also help them to understand how money is earned – which may help change their perception on unnecessary spending. It will also help boost their CV when it comes to securing a full time role.
• Talk about money: Most importantly, be a sounding board for your children’s questions and concerns regarding money. If they know they can come to you if they experience money problems at an early stage, it will be easier to help guide them back on track.