When starting to reorganize household finances, it’s good to involve the responsibilities of all family members, including those who are children. Of course they have no obligation to increase family income, but you can involve children in managing their daily allowances. Things like this must be instilled early, so that the baby becomes more responsible for using money, and helps the family not to be wasteful. Here are six ways you can teach children to manage finances.
Teach Children about Different Desires and Needs
When you will start teaching children to manage finances, start by providing an understanding of the difference between wants and needs. From here children can begin to be taught how to prioritize the items they want to buy. Try to invite the children to discuss, what if your family spends all of its money to buy their favorite toys, but the impact is that there is no money left over to buy food. Will they still choose the toy or prefer to allocate it to food? Also explain what each impact is.
Also give other case questions, what if family money is spent on always buying fast food that is their favorite, but without eating nutritious foods such as fruit and vegetables. Do you need to buy fast food, carbonated drinks, or just vegetables and mineral water is enough? These types of questions can help children to think critically and better understand the differences between the two.
Give Weekly Snack Money and Let Children Manage It Alone
To provide greater responsibility, you can start applying the way to manage finances from the age of Elementary School. Give weekly pocket money to the child, and let him manage his own finances. When giving big responsibilities, don’t forget to teach children to plan their expenses first. Teach to spend money wisely, according to the concept of wants and needs.
Of course, to help children in saving you can also include provisions for each of them going to school, so you can also reduce spending on children’s pocket money to be smaller because he doesn’t need to snack every day. Increase the nominal value of pocket money every year, to make it easier to regulate the period, you can increase pocket money every new school year begins or every child’s birthday arrives.
Teach Children to Save
If the child already has a fairly good understanding of wants and needs, usually there will be a lot of money left in the amount. At this time, start teaching children to save. You can give your child a piggy bank to save money in small amounts. On the other hand, there can invite children to open a savings account at the bank. This will give children a sense of pride because they are trusted to manage larger amounts of money. Do not forget, provide up-to-date information about the money they collect, and ask also for what allocation of money they have saved. Help them to make wiser allocation of funds so they don’t waste after having large amounts of money.
On the other hand, saving can also teach children to be more patient, that not all the things they want can be instantly obtained. Educate them that often they have to wait until the money is collected, or even do hard work so that the desired item can be bought. Do not forget, tell them that if indeed all goods are really needed, then it is indeed worth waiting for.
Give extra pocket money each time they help
Give children the opportunity to gain more money every time they do activities that help. For example, now your child wants to buy his favorite toy. Look again at whether your child is sufficiently responsible for managing money, then decide whether he is worthy or not to be given extra money to be able to buy new toys. If you have managed finances with enough responsibility, ask how much money they currently have, and about how long it will take to buy the item. Let’s just say that the toy that was bought for Rp. 200,000 – and currently has Rp. 50,000, – means they still need Rp150,000, – again, help them by setting targets for three weeks. Give IDR 50,000 per week after they have succeeded in helping you complete household chores, such as pulling grass, washing dishes after dinner, tidying up rooms, etc.
Be careful when going to build this system, do not let the child’s mindset change and think that every time they help them deserve to get a prize. To avoid this, do a system like this occasionally.
Involve Children When You and Your Family Are Shopping
When you will teach children how to manage money, let them really be directly involved in practice. One example of activities that you can do is to let them participate when shopping monthly to the supermarket. Teach children that cutting expenses can be done from the simplest thing. Let them join in doing a price and quality comparison. For example, when you are going to buy granulated sugar, give education that there is nothing wrong with using supermarket brands rather than having to buy a trademark that is already well-known in the media, because quality is usually not much different but the prices obtained can be cheaper. Let children be more involved in spending items, so they know exactly how to manage money more economically.
Before Teaching Children to Manage Finance, Fix Your Way First
It’s no secret, that children usually always imitate what their parents do. From that, the best way is to be a good example for your child. Don’t shop too often, let alone easily tempted by discounts. The higher the frequency of shopping you do, it can have an impact on the baby’s mindset. He will see that shopping often is normal, the important thing is to get the items we want. Reduce bad habits like this, because there is no point in teaching the theory to children if in practice you yourself are often wasteful.