Posted in financial education, Financial freedom, Kids, money management

Teaching kids about saving, management of money

Posted on by Tim Connolly
Teaching kids about saving, management of money
Teaching kids about saving, management of money

Our current educational system focuses almost totally on academic subjects and very rarely is any aspect of money management taught in the school curriculum. This is set to change in due course. Parents have a role to play in encouraging financial literacy among their children and teaching kids about money.

The most practical and profound lessons are at home. They often ask about the age when they should start teaching kids about money, or whether or not they should give their children an allowance or pocket money.

To raise money-savvy children, parents should start to teach from the time a child can count and regularly reinforce money lessons as children grow up. An allowance puts money in your children’s hands and presents and opportunity to introduce budgeting and prioritizing. 

Opinions vary as to whether or not they should be given an allowance. Some argue state that it gives them unrealistic expectations and develops in them a sense of entitlement to be given money for doing “nothing”.

Some parents go as far as to introduce commission based work for chores. Certain tasks at home are thus assigned naira amounts and if the job is done very well, they are paid. If they don’t do the job well or display a bad attitude are unhelpful then any payment is withheld. One wonders if the payment for chores won’t make children tie monetary compensation to everything that they do.

When your children earn or are given an allowance, help them to divide it into three tiers: saving, spending, and giving. By guiding them through these concepts of saving, spending and giving you’re laying a foundation for their future financial security.

Children can start to learn the virtues of work from a young age. One must make sure that the jobs that they do are age appropriate. Even the youngest children can do minor tasks that keep them engaged and provide useful learning opportunities.

As children get older, they are introduced to debit and credit cards. Indeed, as soon as they arrive at some university campuses, they become the target of financial institutions some of whom are keen to introduce debt very early in their banking relationships. 

They must be taught the pros and cons of both. If your children become prone to debt from an early age you can be certain that you will be spending much of your retirement years bailing them out of financial difficulties.

Are your children at home on holiday now? This might be one of the best opportunities to put some financial principles their way. Our children tend to imitate our money habits. They see you working hard so why not put them to work for at least part of the long holiday. This provides a valuable lesson that work is how money is earned.

Sometimes it is difficult to explain things but practical exposure to paying utility and other bills can become powerful learning events. These will be long lasting lessons in how they manage their own money.

Posted in financial education, Kids, money management, teaching kids about money

Financial activities for kids

Posted on by Tim Connolly
Financial activities for kids
Financial activities for kids

Teaching kids financial literacy has several benefits, it helps them to learn the value of money, how to create a personal budget, set up a savings account and about money management. Teaching financial education for kids in class may not be the easiest thing, but there are fun interactive activities that you can use to introduce financial literacy concepts to young kids in the classroom.

Money Toss

This is a fun activity that kids will definitely enjoy. You can start by dividing the students into about four groups. Then give each group a bag containing paper, coins, pencil, a piece of tape and a plastic tray. Then instruct the students to stick the tape firmly to the floor, take five steps back and then place the tray on the floor.

 Then select the “tosses” who will stand behind the tape and the “counter” who will sit by the bowl. To play students take turns throwing coins into the plastic tray. If the coin falls into the tray, the counter adds the value to their count. Each player has five or ten goes.

Money Sort

This is another fun-filled activity that kids will definitely enjoy. Place a divided tray with a circle in the middle. Each section on the tray should be labeled nickel, penny, dime, quarter. Then place all the coins in the middle circle and instruct students to sort the money into the appropriate sections on the tray. Time the students if you want to make it more competitive.

Buying and Selling

Students can be instructed to bring in some items that they would like to part with. Then decide the price for each of the items and have students design price tags to place on the items. After labeling and tagging the items, set up a pretend cash register and let the classroom sale begin. 

Students can be given some amount of play money to shop with and then allowed to take turns shopping for an item. One of the students can be designated to be at the cash register. This is an excellent activity to teach kids the value of money.

Math Coupon

You can come in with a variety of coupons for pupils to search through and clip out. Have students write out a creative math problem on the coupon. It could be about a shopping trip to the grocery store, including the price of the items, the overall money spent and amount saved with the coupon.

Counting coins

Kids love collecting and playing with money. So it is a good way to teach students about the value of money. You can come in with some change and empty food jars.  First have your students sort money into piles (pennies, nickels, and quarters in different piles). You can also spend a little time creating patterns with the money.

The students will have fun guessing the one that will come next. Then count out all the coins i.e. 80 pennies, 20 nickels, 8 dimes and 6 quarters, and keep them in the labeled jars.  It is a great way to help kids {visually} understand the value of money.

These are just some fun activities to teach kids about financial literacy in a fun and engaging way. Don’t underestimate the ability of kids to grasp vital concept financial matters especially about spending and saving.

 Finding creative ways to teach money management to kids offers them the opportunity to learn priceless skills that will serve them well in the future At debt Watcher we have resources and products that teachers and parents alike can use to teach kids financial literacy.

Posted in financial education, Financial freedom, Kids, money management

How to teach kids value of money

Posted on by Tim Connolly
How to teach kids value of money
How to teach kids value of money

In an increasingly digital world, the value of money can be a difficult concept for children to grasp. Here are some tips for helping your children and grandchildren become wealthy and wise.

​When you were young, do you remember standing next to mum or dad at the corner shop and watching them count out notes and coins to pay for the bread and milk? This was a valuable lesson about the purpose and value of money.

Fast forward to today – few corner shops exist and the days of counting change are almost over. When our children see us pay for something at the shopping center, it’s likely to be with a piece of plastic – or even by mobile phone. That’s why it’s now more crucial than ever to consciously teach your children and grandchildren about money: how to spend it and how to save it. Here are five ways to do it.

Help them budget and save

Many children believe parents have an endless supply of money which is why it’s so important to talk to kids about money from an early age. You can start by discussing your own household budget and explaining how you manage costs like weekly grocery shopping and phone bills. If there’s something your child wants, like a new soccer ball or item of clothing, work out a budget so they can save up and buy it. Then reward them by taking them shopping.

Give them pocket money

Pocket money is one of the simplest and most powerful ways to teach children the value of cash – which is why it should be earned rather than given freely. Whether it’s payment for completing chores or a reward for behaving well, children will understand very quickly that money has value. You can also separate their pocket money into portions for spending and saving, so they’ll learn how to put money aside for the future.

​Set up a bank account

​By setting up a bank account for your child, you can teach them the basics of everyday banking. It’s worth discussing the statements with them when they arrive not only so you can explain what each part means, but also so you can check their progress towards their savings goals and praise them as they reach each milestone. You might even open a separate savings account to help making saving fun and easy.

Make money fun

Teaching kids about money doesn’t have to be another chore: there are plenty of games you can use to teach kids financial literacy. From a young age, you can play-act spending situations with your kids, like pretending to ‘shop’ with their toys or using food items in the kitchen. As your children get older, these games can become more advanced.

In fact, one of the best ways may be through playing Monopoly which you can use to teach more complex concepts like rent and taxes. It’s so important to remember that what we teach our children about money when they are young, will impact on their financial future. It’s our responsibility to raise money smart kids.

Posted in financial education, Financial freedom, money management

Money Management Tips for Teens

Posted on by Tim Connolly
Money Management Tips for Teens
Money Management Tips for Teens

Saving money is important. That’s a given for most parents, if not all. We have heard multiple wise sayings that convey the point of how it is of crucial importance to plan ahead and to ensure there are sufficient funds to cover any future expenses. This is especially true once couples enter into parenthood because not only do they have to feed two mouths, but now with the family’s expansion, the cost of living is only going to increase.

An allowance is “a fixed amount of money children receive on a regular schedule, with the understanding that they will pay for certain agreed-upon expenses.” Allowance can be one of the best ways for teaching kids about money.

Parents would save money for their children’s future, which include their daily expenses and future education. However, in spite of all the financial skills parents may have up their sleeves and all the noble efforts of sacrifice and saving, parents may have overlooked the need to teach their very own children to manage their money well since young.

If you want to play a role in shaping your child’s thinking, feelings, and values about money, here is how you should do it. All lessons should start before the age of seven, not excluding saving money of course. The earlier you start your child’s financial education process, the better prepared your child is.

You may start by explaining important concepts such as setting a budget, saving, and goals. Also, you may model good examples as their little eyes are watching you. Children learn not just from the instructions they are given, but also from imitating their parents. 

A toy may have caught their attention as the family strolls through the mall. Or your child may have been eyeing on a new bike or gadget in the market. These are not instances where you give in to your affections to your children by simply purchasing it for them, but are perfect opportunities to educate them. 

Help them turn their ‘wants’ to a goal. With a goal in their minds, that’s where having a regular saving in the piggy bank would come to play. The process will be slow, but the reward will be sweeter, and this will be a valuable lesson for children. Children will learn to be independent and to be diligent in working after something they desire. 

Educating kids how to save money may seem irrelevant when they are young, but it is certainly needed. Be creative in having these conversations with them and make saving money fun and accessible for your children. It will definitely be worth it if you take the time now to educate them to successfully manage money. It is an investment which truly pays the best interest in the future for their own wellbeing. 

Posted in financial education, Financial freedom, money management

Financial education for kids

Posted on by Tim Connolly
Financial education for kids
Financial education for kids

Money management for children is an important life skill. Budgeting an allowance, saving up for something desired, and then spending the money wisely require making good decisions along the way. Once your child has learned this, you have guided him into one day becoming a financially responsible adult.

Set the Example: Save alongside your child

One of the quickest ways for your child or children to learn about money is by copying your example. Together, choose a monthly savings target. This can be anything from saving for a day out, family activities, art equipment, or even new clothes. Whatever the target, make sure it’s something the child wants.

Each week, let them choose between spending money on things they want or saving the money to hit their target. Expect a few slips ups, but use these moments to teach. Spending money now means waiting longer for other items, or missing out on that goal all together.

Money is Earned

Teaching children about the value of money begins at home. This is useful because it just so happens that many tasks are waiting to be completed at home. Your child can complete chores in exchange for pocket money, showing them that money isn’t free.

Chores could include loading or emptying the dishwasher, vacuuming the carpets, or washing the car. Prior to starting this process, make sure to determine allowance amounts and how much can be earned.

Open a Savings account

When it comes to saving money, you have to put it somewhere. Piggy banks are a great way to visually teach your child about money. Savings account are the next step up. Managing money is an essential part of our everyday lives.  It affects the choices we have and the decisions we make and yet we’re neglecting to give our kids a financial education.

Opening up a savings account for your child is a great building block for future financial success. From an early age, your child will have access to all the tools and apps their bank offers manage money. As they grow up, they can work with their back to understand stocks, bonds, and possibly open investment accounts.

Money management is a challenging concept, even for most adults. Teaching your kids about money management at a young age and gradually increasing their knowledge and responsibilities as they get older will be a priceless financial benefit for years to come.

You can show them how to manage cash, start a savings account, how money works through gameplay and hard work, and teach them how to create and stick to a budget. These lessons are ones that many adults don’t even understand.

Teaching children about the value of money begins at home. This is useful because it just so happens that many tasks are waiting to be completed at home. Your child can complete chores in exchange for pocket money, showing them that money isn’t free. Chores could include loading or emptying the dishwasher, vacuuming the carpets, or washing the car. Prior to starting this process, make sure to determine allowance amounts and how much can be earned.

Posted in financial education, Financial freedom, money management

How to teach money management to your kids

Posted on by Tim Connolly
How to teach money management to your kids
How to teach money management to your kids

Money is an indispensable resource and we have to be wary of how we utilize it. It takes us a long time to get the hang of the concept of money management. But, what if we teach our children from a very young age so that they won’t have to face the same challenges as we did?

Children are fast learners, and they observe everything very keenly. We have to teach in a way that they will remember these lessons for their entire lifetime. Here is how we can teach our children money management so that it has a long-term impact on them.

Give them pocket money

You can give your children a fixed amount every month for them to spend on whatever they want. It will also give them the independence to purchase what they want. They will also learn a very important lesson, ‘with great power comes great responsibility.’

Sure, they will sometimes recklessly spend their pocket money, but after one-two incidents, they are going to get the knack of it.

Let them handle some expenses

How long will you do your children’s work? At some point, you have to start letting them do it on their own. So why not start as early as possible? You can let your children handle some money-related matters appropriate for their age.

Things like shopping for their clothes, buying stationery, and so on can be done by kids as soon as they start growing up. If they want something from the market, then let them go on their own and purchase it. It is going to increase their self-esteem and also give them some practical experience with money.

Let them be accountable for themselves

Children are bound to bungle it up once in a while. And that is alright. We just need to teach them to be accountable for themselves. If by any chance, they lose some money, they need to hold themselves accountable for it.

Your job is to not panic, stay calm, and let your children do their job. If they mishandle some money, then don’t stress out. Instead, help them overcome the situation. It will be more helpful to them, rather than getting angry at them for their blunders.

Let them handle money-related chores at home

There are many chores in the house that require a trip to the market. You can sublet that work to your children. You can give them tasks like picking up groceries, buying stationery for the house, buying miscellaneous items, etc. your children will get a hands-on experience of the real world.

When we want to make our children independent, more often than none, things like surviving in the day to day world are missed out while focusing on the bigger things. We focus on making our child’s careers and making them successful.

Let them explore different options and then discuss

There is so much involved in how to teach kids about money as it involves understanding and implementing theoretical and practical knowledge for same. You can teach them how to manage money, different ways to invest, different ways to save, etc. This way they can learn it in detail.

Teaching Teens about money when they’re young lays the foundation for responsible money management later in life. Children whose parents emphasize the importance of financial literacy and encourage them to spend and save thoughtfully develop a healthy perspective on money.

Give them money to invest and grow

Children need to understand the brilliance of investment. Our money makes us more money because we chose to put it in the right place. Isn’t that amazing! It is as simple as that. Give your children an opportunity to learn it. There is a strong possibility that they will make some bad investments along the way, but that is just part of the learning curve, isn’t it?

Let them waste

The lessons that are etched in our brains are often the lessons we learned from standing up after falling. When we go through an experience we remember the learnings it taught us. If we want our children to learn about money, we need to let them fall a couple of times till they learn to pick themselves up.

When we give our children money, let them make mistakes, let them waste it. We do not have to go into a panic mode the moment they falter. When they will falter, that is the only time they will understand.

Posted in financial education, Financial freedom, money management

How to teach financial literacy to teenagers

Posted on by Tim Connolly
How to teach financial literacy to teenagers
How to teach financial literacy to teenagers

We all want to encourage our children in ways that help them become self-confident, motivated and strong in the face of a rapidly changing world. Ultimately, we want them to be safe, happy and well-adjusted and teaching kids about money can help with that.

If you start the conversation about spending and saving at a young age, key principles will become deeply rooted. Looking for ways to teach children to save? Here are some ways to get started.

Talk about money

Early memories are imprinted for life, and money memories are no different. Here’s one idea for how to teach your child financial responsibility: When you buy things with credit cards in front of your kids, show them the resulting bills compound interest and all. It’s a natural way to start building financial literacy for kids. With a real-life example, they can start to understand the real costs involved and you can start a conversation about the difference between wants and needs, too.

Make it visible

Financial literacy for kids has never been more important since we are living in an increasingly cashless age of credit cards and one-click digital transactions. There’s value in exposing kids to coins and dollar bills especially as you think about how to teach kids to count money. Consider buying them a piggy bank they can fill with quarters and dimes.

This will help them appreciate the physical act of saving. You could even consider using this strategy for teaching preschoolers about money. As they get older, you can teach children to save by opening an account with them at a brick-and-mortar bank branch. Encourage them to deposit some of their weekly allowance in the account, and share their statements so they can see any interest they earn.

How to teach kids about budgets

Most people learn to live on a budget after leaving home, but you can give them a head start if you teach children to save for such things as movie tickets, gas and that monthly stop at the vintage clothing store.

Teach them the value as well as the cost

You spend money on things that you value, so in a way your spending habits reflect your values. Giving back to others may be important to you and your family. If so, encourage children to donate their money to causes they think are important. When their funds are limited, they can still give back by donating their time. Not everything of value has a dollar amount associated with it.

If younger children want to start a business to meet a community need, chat with them about what it means to be a social entrepreneur. Show them how they can design a business that addresses a cause or issue and uses sustainable practices in keeping with their values. They may even want to donate a portion of their profits to the cause their business model supports.

Financial education for kids starts when kids are between 7 to 9 years old. Youth who are not taught how to manage, value, and work for money lack the skills they need to be self-sufficient. This situation has an impact not only on the child’s future finances, but also on self-esteem, relationships, and overall enjoyment of life when he or she matures into adulthood.

Posted in financial education, Financial freedom, money management

Money management techniques for teens

Posted on by Tim Connolly
Money management techniques for teens
Money management techniques for teens

When it comes to teenagers and money management, limiting spending is often the first thing that comes to mind. Parents try hard to help their teenagers grow beyond by teaching them about personal finance and money management; however, it’s no easy task. Savings, compound interest, different types of accounts, credit cards these are all complex topics that require time and dedication to integrate into your life.

The 6 tips below will help parents focus on teaching kids about money so they can make smarter decisions when they head off to college or move out on their own.

Help them achieve a steady income.

Learning to manage their money is a key part of teaching kids about personal finance. In order to get them learning, help them establish a steady income. Have them start applying for jobs or start giving them an allowance. 

If they’re stuck, you can try inspiring them with stories of entrepreneurs who have built successful companies through a combination of creativity, leadership, and business-savvy. Once they know the rewards that can come with an understanding of business principles, they’ll likely be motivated to start earning.

Have your teens spend only “their” money

When your teenager starts bringing in an income from a job or an allowance, they should start covering their own personal expenses. Doing so will teach them that they need to watch how much they spend and to stay within their budget. If they (and you) want to get tech-savvy, they can even test out a personal finance app.

Open a savings and checking account

The next step is to open a savings and/or checking account for them. They should make their own deposits, keep their account balanced to avoid overdraft fees, and, of course, save their money. While you are at it, you should also introduce them to ATMs and online banking. Helping your teens understand the differences between checking and savings will also introduce them to the concept of account fees and interest rates.

Show your teens how to create a personal budget

Helping your teenager put together a budget is one of the best things you can do for them. They will learn that spending money haphazardly will not help them reach their financial goals. 

In addition to the apps mentioned above in point #2, many computers have basic budgeting software built in. Apple, for example, has a Numbers app that includes personal budget templates to get you started. 

Talk about the importance of savings with your teens

Savings is an essential part of teaching proper money management. 5-10 percent of their income should go towards savings. Explain to them how saving money now will lend itself to less financial worries down the road and more flexibility to pursue their dreams. 

Being able to have open discussions about this helps demystify and normalize finance, which can be a black box for many people. Once you begin talking about these topics openly, the easier it will be to integrate financial management into a teen’s daily routine.

Teach your teens about saving when shopping

Shopping presents another great opportunity to teach your teenager tips on how to save when they go to the grocery store or the mall. Help them search out the lowest price, so they know they are getting the best value possible. There are also tons of coupon apps and websites to show them. 

Now would also be a good time to talk about delayed gratification by waiting for something to go on sale or giving it at least 30 days before making a purchase as they may find they no longer want the item. Debt-wary families can also explore alternative financing for household items. Interest-free, pay-over-time options like Bread can help reduce up-front costs.

Giving a glimpse into your household finances is a great way to show your teenager the larger picture of personal finance. Discuss how much income is coming in and how you go about managing your monthly expenses along with daily costs and saving for retirement and a rainy day.

You don’t have to be an expert. Pointing out areas where you’re also trying to improve will help them understand that learning about money management is a journey that you work on your entire life.

Posted in financial education, Financial freedom, Kids, money management

Teaching Kids the Importance, Saving and Value of Money

Posted on by Tim Connolly
Teaching Kids the Importance, Saving and Value of Money
Teaching Kids the Importance, Saving and Value of Money

In general, kids have little knowledge about money management so it is the prior responsibility of parents for teaching kids about money. As a parent, you want the best for your children. This doesn’t necessarily mean you want them to have the best clothes, the latest toys, or the coolest gadgets. Most likely, it means you want them to be safe and secure.

To most children, money seems to grow on trees. They have a vague understanding of how their parents get them food, clothing and toys. It seems to a child as though people just go to the store, get what they want, and leave.

So, whose responsibility is it to teach them how to handle money? Parents hold the weight of that lesson, and it’s an important one! Without the proper education in dealing with money, children of today are at risk of becoming financially irresponsible in the future.

What Is Money and What Does It Do?

Does your child understand that money is used to get “stuff”? Are they asking questions about money and what it does? If your answer is yes, then chances are they’re ready to learn more about it. The best time to start this type of explanation is around the age of three.

Borrowing Money (Debt and Credit)

Once your child can grasp the idea of spending and saving money, and they’ve begun to manage a little bit of their own money (either through allowance or extra jobs around the house), you can begin to introduce the idea of borrowing money. By teaching your kids foundational principles of spending and saving at an early age, you can help them form positive financial habits that will last their entire lives.

Part of putting kids in control of their own money is letting them learn from their errors. It’s tempting to step in and steer kids away from a potentially costly mistake, but it may be better to use that mistake as a teachable moment. That way they’ll know in the future what not to do with their cash.

Posted in financial education, Financial freedom, money management

Teaches kids how to spend and save money

Posted on by Tim Connolly
Teaches kids how to spend and save money
Teaches kids how to spend and save money

Arming children with a solid financial education can set them up for a more financially secure adulthood. However, a new study finds that few parents actually make time to talk to their children about money matters.

Findings from a new survey commissioned by digital financial services provider Ally showed that although 83% of parents believe saving money is one of the most important money skills children should learn, only 13% of parents regularly talk to their kids about financial matters.

In an effort to help parents educate their elementary school-aged children about money, Ally Financial has launched a free digital children’s book with a storyline that reinforces basic financial concepts.

Building financial literacy

“Planet Zeee and the Money Tree” is a tale about three children from another planet who come down to Earth and can’t quite seem to grasp the concept of money. Fortunately, the aliens meet children from Earth who teach them how money is earned, used, and why it’s important to save and give back.

The e-book and its accompanying resources for parents are an extension of Ally Financial’s Wallet Wise program, which offers tools to help consumers better manage their money. In creating the new materials for families with kids, Ally hopes to teach kids money skills and concepts that will come in handy in adulthood.

“Ally believes that learning about money and building good habits from an early age can help young people make smarter money choices and feel more empowered over their personal finances and their lives in the future,” said Jacqueline Howard, director of corporate citizenship at Alley.

Teaching money skills to kids

Ally’s research revealed that 33% of parents actually felt uncomfortable talking to their kids about money. But financial literacy isn’t a topic parents should shy away from; fostering good money habits in childhood will help kids better manage their finances when they’re older. 

Parents should also provide financial education to kids and make them understand that credit cards aren’t a source of free money. After kids have learned the importance of spending wisely, they can be taught the importance of saving money. Parents can demonstrate this concept by having their child set goals with savings, such as saving for a new toy or game.

When kids see their parents pay with plastic, they may not realize that money is being withdrawn from a finite source. Parents can teach kids about the concept of working for money by helping them set up a bank account for saving and allowing them to earn money by doing chores.