Tips on Teaching Your Child About Money

They say money is what makes the world turn. While this might be true in some aspects, what is true in all is that our children should know how to earn, save, and be responsible with what they have before they move out, if possible. Instill a heretical connection to money, a physical connection, and a healthy psychological connection, as well. Below are some tips you may already be familiar with and some you may not.

The History of Money

Currency of some type has been in existence since at least 1200 BC. People traded livestock back then. You might pay a chicken for a shirt or a whole cow for 3 pigs. I am sure you can already see what might be wrong with this form of currency. What was equal was almost always up for debate and there were times the seller just was not interested in what the buyer had. To combat this dilemma, the Chinese began to use metal slugs as currency. This eventually turned into what we now see and use on a regular basis to pay for everyday items. What does this have to do with teaching children about money? Your children will develop a larger sense of responsibility for what they earn and save if they know what went into making it. It will help them to develop a respect for the sacrifice that went into making sure we could deliver and fulfill the needs and wants of a person through supply and demand.

Teach Them How to Earn

In the world we live in, the only way to have money given to you for no reason at all is to win the lottery. Even then, you have to invest the price of the ticket. Money is earned and our children need to know that one, they are not owed anything from the world, and two, they will live within the means they are willing to work for. What you teach them should be based on how old they are. Five year olds can’t just go get a job, but they can do chores.

However, there are a few things that should be universal. Do not just give your child an allowance. This teaches them that they should just inherit money, because they exist. Not only will they be confused and frustrated when it comes time to earn on their own, they will never accrue the respect for the earning process you went through to provide their needs and wants. Also, don’t help them all the time. There comes a time, when as a parent, we have to step back and allow our children to fall so they learn how to get back up and try again.

Show Them How to Have a Right Relationship With Money

Many children live in poverty stricken areas where the lack of money is an enemy. Some, are raised to connect earning power with their self esteem and others are taught that money is just a thing and carries no importance at all. Still, others learn that money is a symbol status. If we are not careful, our children will carry these lessons into adulthood. There has to be a balance. Our children need to know that money is necessary for the purchase of most things, needed and wanted, that it can be used to help those in need and we should always be willing to share wisely, and that having plenty of it will help you have a little less stress in life. However, they also need to know that greed is a nasty addiction that will ruin several places and relationships in their life, money is not necessary to live, and that spending money frivolously will lead them to a lot of stress and heartache.

If you follow these tips when teaching your child about money, you’re almost guaranteed to raise a money wise young adult.