It is the utmost responsibility of the parents to teach their children about the value of money and how smart they can be with their money. Smart spending habits and Investing habits are not taught at schools. It is at home the kids learn these aspects.

It is better you educate your kids on the value of money as soon as they start counting. You can let the child know the things you cannot afford. Though the concept of “We cannot afford it” can be detrimental to their mindset, you have to make them think that rolling in riches is not the way to be financially happy. You should restrict the kids from doing certain things which may be fun to do. This can help you teach the kids about intelligent financial decisions, in a better way.

You have to teach them the value of saving money. You can best set up a weekly allowance for them. You have to tell them that certain fixed amount has to be put in the bank so that they can meet the unforeseen expenses. For example, they may fall sick and may not be able to earn the allowance for few weeks. If they save their allowance without spending all of them, they will be able to meet their needs during such times. You must also let them plan the purchase of their toys from their allowance. This will let them know about savings in a better way.

You can get them involved in a business which can help them know about money and finance in an effective manner. This will also instill a good work ethic in them. You can pay them on an individual basis for different chores. You can also introduce an allowance system where they can earn extra amount for the extra work performed.

You can easily teach the kids about saving money by purchasing a piggy bank. Pay them in whole amounts and encourage them to save their change by putting them into the piggy bank. You should ask them to collect a big amount. When the piggy bank is full, you can then allow them to spend a portion of the collected amount in whatever way they like.

If you are not satisfied with the way your children are spending, you need to talk to them. You should make them understand the outcome of their purchases. This should be done through each of their purchases. This will let them know how they are using the money and how much they are saving out of their allowance. You should practically guide them.

If your child is spending all the allowance, teach him/her that if all the money is spent at one go then nothing will be saved for another purchase. They will have to wait till the next allowance is given to them. Teach them to plan in such a way that only a portion of their allowance is spent and the rest is saved. This savings can be used for further purchases.

However teaching the concept of savings to the kids is not a one time task. It has to go on continuously.

Irsan’s passion is to write on variety of subjects. Please visit her latest website at sunbeam water dispenser which contains reviews on avanti water dispenser and other information about water dispensers.

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