Of the many life skills you need to teach as a father, the value of money, how to spend, and how save it, is important. Starting as early as possible will help to prepare them and lay the foundation for the rest of their life, from the time they get their first job in their teens, all the way through to adulthood.
This is another age-old question many parents, fathers and father figures have, and often wonder how to go about teaching the value of money and how to save. One of our sponsors in Perth, P&N Bank, has provided some tips on how you can start.
Six money management and saving tips to teach kids
- Encourage and instil the habit of saving
Teach them that money isn’t just for spending, it’s also for saving. Help them to plan and set savings goals. With children, it’s usually easier to teach them to save for short term goals, like saving their pocket money to buy a new toy they’ve had their eye on.
- Create opportunities to earn money
Establish age appropriate chores and have them earn pocket money. This helps them to understand the importance of working to receive, and earn money, and that it’s not just handed to you or ‘grows on trees’.
- Lead by example and model good financial behaviour
Model behaviours around money that you want your children to adopt. Encourage your children to shop around to find the best deals, wait for items to go on sale, and keep your eye out for good quality products. If you want your kids to make good spending and saving habits, you need to model this to them.
- Provide your child with 3 jars. A ‘needs’, ‘wants’ and ‘savings’
Ask them to deposit their pocket money into the jars, using the 50%, 30%, 20% respectively to teach them the importance of managing money.
- Explain the concept of money.
Show them coins, notes and debit cards, and explain that they can be used in exchange for goods and services. Use real life examples they’ll understand, like getting a haircut or buying a new game.
- Explain the difference between what you need and what they want. This shows them the difference between items needed every day and ‘luxury’ items.
Any advice given in this article is general only and does not take into account your personal objectives, financial situation or needs.