baby

At the mall yesterday, I passed a father and his daughter at a hypermarket. She was maybe ten or eleven and pestering for a expensive dress and he was clearly exasperated with her. “You have no conception of how hard your mother and I work to earn money, do you?” he said. There was desperation in his voice.
How and when to communicate money values to children is one of the toughest challenges that parents face. You want to support your children, to shield them from the hardships of life. But without facing the hardships, they won’t appreciate the value of money.
It’s never too early to start teaching kids about the value of money, saving and financial responsibility. When children are given the opportunity to learn about money from a very young age, they are empowered to ask questions and to discover what money means to them.
You can tell your kids all you like about how to save money or becoming financially smart, but at the end of the day, they are going to learn from what you do. Kids will always pay more attention to what you do, rather than what you say. You must set a good example when it comes to your finances.
Here’s how to do it.
Start Early
Starting as early as possible ensures your kids develop the right attitude towards money is important. You can do this by making sure you use your money responsibly. It’s no use starting when they are teenagers, as they pick a lot of it up when they are very young.
When you do talk about money, know how to talk about it properly
When you talk to your kids about money, make sure you know how to talk about it properly. You should be open with them about what you’re doing with your money, and give them advice on what to do with theirs when they have it. Speaking to them about it like adults is important. Try not to discuss money in a negative way, as many people do. Although money isn’t everything, a positive attitude towards money will help them later on in life.
Get your kids their very own piggy bank
Make it a permanent part of their life. Deposit spare change as a reward. At first, it won’t make sense for up until several years but they will develop a sense of ownership, pride and accomplishment as it fills. Let them make their own choices as to when and how to spend the coins inside.
Visit the bank
Taking your child to the bank is worth more than just a free lollipop. Watching bank transactions helps kids understand what cash actually is. Let your child be involved as much as possible. As your child gets older, consider opening an account for him, and help him learn to track his savings.
Do start giving your kid an allowance at about age five
or at the same age when you start expecting and asking them to pick up and put away their toys, help with the dishes or fold laundry. In other words, make it clear that there is no free lunch. Let them know what your expectations of them are and that if they accomplish the tasks you set out for them, they will receive a certain amount every week – to save or spend.
Don’t restrict them in the spending of their money
Kids do well to learn about spending as well as saving – after all, there is smart spending and silly spending. In other words, don’t micromanage their money for them – let them make a mistake or two. As the saying goes, “Better now than later when they’re buying a house or car.”
Let kids make their own purchasing mistakes
Even if you think your child is about to waste her money on a toy she’ll soon tire of, you might want to let her go ahead and buy the item anyway, because it might just teach her a lasting lesson. A father says that he noticed his children feel like they wasted money on toys that they enjoyed only one or two times and thinks they learn from it.
Encourage them to set goals
Having an item or a goal in mind like learning how to save up for a big goal, like purchasing a special toy, out of her allowance money can help kids learn to delay gratification, and it’s also good practice for saving for big things like retirement or a vacation as an adult.
Do teach them the meaning responsibility
If Karan can’t be bothered to put his bike in the garage and it gets stolen, don’t replace it for him. Let him save to buy another. It’s tough love and a fantastic lesson learned about taking responsibility, how much things cost and how much work goes into having the things we all want.
Live Below Your Means
So many people spend more than they earn and end up in debt. It’s up to you to show your family how to manage their finances by living below your means. This means spending less than you actually earn, in short.
Plan Your Purchases
Planning your purchases rather than buying on impulse sets a really good example to your family. Act like you have to wait for a check to cash.
Try not to use credit for non-emergencies
Credit can be useful, but using it for non-emergencies can be a bad idea. You could potentially end up in debt with a lot of interest to pay, and kids usually pick up their parent’s spending habits. Unless you have an emergency or it makes sense to use your credit for whatever reason, steer clear. Don’t spend money you haven’t got.

A Rupee goes a long way…teaching value of money to kids !

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