Some kids were born with a gold spoon in their mouth, but not all were! If your kids weren’t born with a stash of never ending cash, then you’ve got to do the next best thing for them, which is to make sure that you embed enough frugality into them that they end up financially better off than their peers.
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Get them just as excited to do maths and mental calculations as you do with wanting them to learn to read. Give them a feel for money and its value from early on. It starts with simple counting activities like, how many peas they have left on their plate.
Get them saving their coins from early on. Friends and family members usually separate themselves from their cash while pinching the cheeks on the little darlings. Encourage them to watch that savings grow into quite a fine sum before too long. You could make it into a game of some sort.
Take them to one of the coin change machines when they’ve saved up enough. Watch their eyes light up when they see how much they’ve saved and what it can be used to purchase. Encourage them not to spend it all in one go.
Let your kids keep a really basic system of accounts for their savings and how much they are spending. All it needs is an exercise book with three columns: one for the date and the others for when money is put in or taken out.
You must give them pocket money weekly or monthly, depending on their age and your circumstances. It may or may not be linked to chores done, that’s all entirely up to you.
Teach them to save up for bigger items that they want to purchase. I started putting a small amount of money into a bank account for my child several years ago and made it so that the funds could not be touched until the child is 18 years old. I was shocked to realise that, although we have quite a way to go before the 18th birthday, the account actually has thousands of pounds in! This, I’m thinking, is enough for a trip abroad, a first car, even a deposit on a house!
So it’s a good idea to put away some money for your child each month in a secure bank account in the child’s name until they reach 18 years of age. This will really help them to realise that every little adds up.
Encourage them to live within their means, not to rely on borrowed money but to pay it back in a timely fashion if they did borrow. I know that as soon as children reach the second half of the teen years, they start to be bombarded by banks and other financial institutions, offering them credit cards with ‘real’ money on. If these children are not careful, they start off their adult lives already in debt. Teach them about this before they reach the age. It’s good to be financially literate.
Teach the value of investing. You can share your own stories with them. Help them to monetise by sorting and offering for sale some of their possessions that they no longer want or that no longer fit.
As they get older, encourage them to do chores for relatives and other family friends for a fee. This could include, pet sitting, cutting grass, picking fruits, styling hair, baby sitting, doing laundry, shopping etc. They just need to be creative.
Discourage them from activities that zap their savings like gambling, slot machines, betting etc but encourage them instead to open up a savings account as soon as they are old enough. Then they could transfer to a more recognised and less tempting method for keeping their savings safe.
Encourage charitable living. It works. I don’t know why it does but it does. Giving and helping others just seem to operate on a really good wheel where the benefit always come back to giver.
Encourage, encourage, encourage. Little ones sometimes get frustrated when they can’t seem to save up enough, or their money gets lost, or they want to empty that piggy bank and spend it on the first item their eye catches. You are there as the main encourager and motivator.
Depending on their age, don’t make the decision for them. Of course when they make bad decisions, talk them through it, allowing them to see that they could have done things differently.
In a few years you would have raised a frugally sound and financially stable individual, raised by your own fair, frugal hands.
Oh, by the way, for your own 101 frugal tips, click this link and get them in a format you can choose to read or print out. It’s truly an amazing list that you’ll wanna keep and share with your friends.
Let us know if you’ve implemented any of these tips with your own kids and also do share if you have ideas of your own. Who knows, your financial wisdom shared with your own kids might one day come back to benefit you.