One should empower children as young as possible by learning to teach kids about money. This gives young and old the ability to make quality decisions about various aspects of their lives. Education and motivation of young ones in this area should not be ignored. Teaching them to save money gives them power to buy all the things they wish to buy.
Once kids can count, they should be introduced to money. Repetition and observation are two important tools to be used when educating children. Always be communicating the values that should be applied to money. Saving money and spending money wisely should be taught to them at an early age. Children should learn to differentiate between wishes, wants and needs.
Goal setting is another very powerful tool that children can use when working with money and a good way for teaching kids about money for parents. More often than not goals that have been established are normally achieved. Instead of relying on parents to buy toys, the child can set this as a goal for him or herself. This is a very good lesson in responsibility.
Children need to understand the difference between the saving and spending. The art of accruing interest should be relayed to the child. One could even pay interest to the child if he or she saves money at home. The compound effect of interest should motivate the child to save money. Children can learn from an early age the power of establishing a good credit rating.
The children should receive pocket money in denominations that encourage saving. If the child receives five dollars then he or she should be encouraged to put one dollar aside as part of the savings program. This could amount to a tidy sum of money for a child after a number of years and it develops good habits at a young age.
As soon as possible, the child should open up a banking account. This will make them adopt a serious attitude about money. Should the child wish to withdraw money he or she should not be discouraged. Doing this can demotivate the child from saving in the first place.
Teaching children about money is a must so you can prepare your kids for a better financial future.