Wednesday, August 26, 2015

10 Ways to Teach Kids About Money

Money empowers people to make decisions, educate and motivate. Decisions on daily expenditure can have a great negative impact on kid's financial future.

Following are ten ways to teach kids about managing money.
1. Introduce kids to money, as they learn counting.
You should provide them with required information. Repetition and observation are two vital ways kids learn. As early they learn, they'll become more sensible about money.
2. Interact with kids about your money related values.
Ways to make it grow, ways to save it and above all ways to spend it sensibly.
3. Help kids understand the differences between wants, needs and wishes.
This will develop them as good decision makers in terms of spending in future. Also it will help them to learn the ways of saving while living a standard life.
4. Goal setting is fundamental to learn saving and the value of money.
Almost every toy or any other item that kids ask parents to procure them can be an object of a goal-setting session. Make them understand about the pros and cons of the procurement.
5. Show kids how to assess radio, TV and print ads for products.
Will the product actually perform and do that the commercials say? Is the price offered actually a sale price? It will help them to evaluate a thing in a proper manner before buying it.
6. Alert kids about the cons of borrowing and paying interest.
You can charge interest on small-scale loans you make to kids, they will learn promptly how costly it is to rent someone else's money for a certain period of time.
7. Grab the opportunity to demonstrate the kids the working method of credit card while using at a restaurant.
Explain the kids how to check the charges, how to determine the tip and how to safe guard your credit card.
8. Give kids their allowance in denominations that inspire saving.
If the allowance is $5, give them 5-1-dollar bills and inspire that at least one dollar to be kept for savings.
9. Keeping records of money invested, saved or spent is another vital skill kids must learn.
Use 12 envelopes, 1 for every month, with a large envelop to keep the entire year's envelops. Encourage kids to keep the receipts from all procurements in the envelops and keep note about the activity with the money.
10. Introduce kids to the value of saving versus expending.
Consider paying interest on cash kids save at home; kids can help determine the interest and see how fast cash increases through the power of compound interest.

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