If you want your children to have money and be financially sound when they grow up here are 3 tips to set them in the right direction;
1. Watch your language around your children.
I’m not talking about swear words I’m talking about bad words!
Words such as, ‘poor’, ‘can’t afford that’, ‘money doesn’t grow on trees’, or ‘we don’t have money to burn’.
These kinds of words and phrases cause children to grow up with a very negative belief system around money and if you believe money is in very short supply, how can you have, be or do things that involve money? It creates an inner conflict.
When I help people around money issues, it always started with the words and language around money their parents used as they were growing up.
If you can’t afford to buy something, instead of explaining to your child how poor you are, or how you have to pay bills with the little amount of money you have or any of the other negative words and phrases that come to mind, why not simply say something like, *“lets take a picture of it and we will buy it later when you have tidied up your toys”*, or *“lets buy it later when we sort out your box of toys to go to the charity shop”* or *“we will buy it later when we sell some toys on the internet”*?
You can be as creative as you like with a reason that’s positive for your child. You are not saying no to anything and that way you can have a happy child with a healthy relationship towards money.
2. Encourage your child to save money.
Start with a piggy bank and when it gets full, open it up and count out the money with your child.
Praise them for being so good at saving up. Let them then divide the amount into four ways;
1) 10% to keep and save never to touch until they are sixteen or eighteen,
2) 10% to give to a charity of the child’s choosing,
3) 40% to spend on anything they like now,
4) 40% to save towards something in the near future such as a pair of roller skates or a football strip.
Children love this bit of decision-making and it gives them responsibility and pride.
3. Let your children understand how to make money.
I make fudge sometimes with my children. One day I made it with my oldest child (who was 7 years old at the time), and I asked her to help me price all the ingredients to make the fudge. We made a batch and she helped me to cut it into squares and weight it and divide it into little bags. We then worked out how much to charge for each bag that would give us a bit of profit. My daughter and her friend then went out and sold the fudge to our neighbors’ and came back with the money.
We divided it up by taking out the money it cost us for the ingredients, and then we had the profit.
We divided the profit into, 10% for charity, and what was left was divided between my daughter and her friend.
They both released how much time it took to make, package and sell the fudge. My daughter also understood you have to work at something you enjoy to make money and she was more understanding of the physical process. You could pay your children something for doing household chores or set up a stall at a car boot/garage sale, or you can put your thinking cap on and come up with something even more creative. Its great fun and your children love doing things with their parents as well as learning valuable tools for the future!
Exploring these suggestions with your children as early as possible gives them a great start with money.