We usually associate finances with adults. All over the world, elders are the ones who look after the process of managing money, from earning to spending and even investing it for the future.
What we forget is that allocating such a responsibility to only one age group is inefficient, especially with the recent trend of youngsters stepping into the world of money.
Despite what this trend is a result of, the growing economic crisis needs people to plan ahead of time. According to Bill Schantz, people plan what they know, and they know what they have seen.
The same rule applies to teaching kids about saving money; this does not mean making them save money for their adult life; instead, it’s about introducing the concept and helping them practice to make them familiar with it.
Practice What You Preach
Children model their parents, as Bill Schantz says.
Human psychology states that the first form of social interaction is observation. In simpler words, kids do what they see their parents doing. They learn through these observations and certain behaviors they repeat as well.
Thus, it is crucial to know the importance of practicing what you preach. Exposing kids to financial talk early on helps them stay in the loop. So, if parents practice saving money, the possibility for kids to take up the habit increases too.
Bill Schantz Says to Talk About Money
As stated earlier, talking about money with kids helps a lot. They not only get to know the importance of money but also the different tricks associated with it.
When it comes to saving money, there are many things that one can talk about with their children. A conversation can start by explaining what it means to save money.
Follow this by discussing the benefits of saving money. This includes having resources in case of emergencies or for future planning and having financial independence.
Next comes ways to save money. Talk about little tricks that children can practice saving up on money. You can help them set up a piggy bank. They can add a fraction of their allowance to it to build up their savings. You can also set up a savings account if your kids are older.
Discuss the end goal of saving money. The best way to motivate kids to save up is by giving them something to look forward to. For instance, instead of buying a new gaming console for your child, encourage them to save for it.
The sense of satisfaction at the end will be unbeatable.
Bill Schantz Says to Help
Understanding financial things can be a bit challenging, especially for younger kids, as per Bill Schantz.
It is essential to facilitate your child where possible to tackle this. Be patient with their questions and help them set up their saving system; they might want one different than yours. Know that that is completely okay; what matters is they learn.
Some tips to help your kid with saving money are:
- Help them set a budget for their allowance.
- Create opportunities for them to earn extra by doing chores.
- Act as their creditor once in a while because it is common for kids to be impatient. So, if you end up paying for something, pay it as a creditor by lending them money.
- Know that they will make mistakes.
Bill Schantz’s Parting Note
Teaching about saving money is important. Yet, always know that your kids and still kids. And they can only practice this to a certain extent. The goal should be to make them aware of the process, not to pull away from your financial responsibilities.
According to Bill Schantz, that way, everyone enjoys!