Having good personal finance habits is one of the keys to a being successful person in life. Being stable financially leads to healthier relationships and a better state of mind. People aren’t born already being good with money, they learn it in their youth. It is in that 10 or so year timespan that this knowledge is learned. Therefore, if you want your kids to not follow the same mistakes you’ve made, you’ll need to teach them good personal finance habits like these:
Give Your Children An Allowance
Every week, give your child a certain amount of money. The amount you give them depends on things like how much you can afford, their age, their grades in school and their household duties. Give them the same amount every single week. If they want an advance for the next week, just say no. If they want a raise, just say no. When your kid wants to buy something but they can’t afford it, you need to tell them that they need to save their money until they have enough to buy it. Avoid giving in when your child begs for extra money. You will in reality not be helping them, but just teaching them how to overspend.
Teach Them Proper Budgeting
Guide your children on how to budget their money properly. You can do this by teaching them to list down all the expenses they have and identify which of those expenses they really need and which ones they don’t. Then, you can also teach them on how to budget the money they get from their allowance and how to properly allot them on their expenses. This will teach them how they can properly handle their income in the future as well as teach them on how to prioritize more important things over luxuries.
Let Them See The Household Expenses
It is also a good practice to allow children and especially teens to see the monthly household expenses such as utility bills, grocery expenses, insurance, income taxes and the likes. This will teach the young people that there is a cost that accompanies everything they see or use at home. This will prepare them once they start living on their own and start paying bills on their own apartment. They will also gain an appreciation for all the hard work you do to pay all the bills.
It is very important for parents to teach their children as early as possible about the importance of having good personal finance habits, as this will help them build a good foundation when they set out in the future on their own.