Money matters

WE’VE all seen them – adults who have no idea how to manage their money.

While it’s easy to look down our noses at them as they take out their third mortgage to make payments on their SUV, we should stop and think about where they learned their financial attitudes.

We may realise that our children could be close behind if we don’t teach them how to manage their money wisely.

Financially-savvy children grow up to be well-off adults, so it is an excellent idea to teach your children about money.

Children learn their financial attitudes and skills from their most important teachers – their parents.

Your childre are watching you every day. Take the time to educate them about the value of money, what credit is all about and how to be thrifty and save money for a rainy day.

Take the time to explain to them that each action is a financial choice, one that you are making so that you have more money for things that are on the top of your priority list for the family.

Along with teaching your children about money, take the time to teach them about work, as well. Let them see that you work hard for the money you earn.

When they ask you to purchase frivolous items, explain to them that you will have to work a number of hours to pay for it. Would they rather have the item, or more time with you?

It’s important for your children to learn about the exchange of time for money, so that they realise that money doesn’t just magically appear.

Teach your children that money is finite. Help them to understand that they must make choices about how to spend their money.

Remind them that this applies to their mummy and daddy as well.

Demonstrate to them how to purchase items on sale, clip coupons, and purchase quality items for the best possible price. Doing so will help them to learn the value of the ringgit and how to make their money stretch as far as possible.

Make rules in your home on how money is handled and spent. When your child receives money, either as a gift, an allowance, or by working for it, teach them about saving and spending.

Open a savings account for them, and make it a requirement that a predetermined percentage of all their money be put into it. Let them set a goal to save for, but be sure to reinforce the act of saving.

By doing so, you’ll be teaching your children a skill that many adults have not yet learned – and a valuable one, at that!

As your children grow, allow them to take on odd jobs suitable for their age level, such as walking dogs or mowing grass. You’ll be providing them with a sense of responsibility and ownership by allowing them to earn their own money.

You may be surprised at how reluctant they are to spend it, once it’s earned. It’s much easier to spend money that is given to you than to spend your own money that you’ve worked hard for.

You may find that children are quick learners and the earlier you teach them the rudiments of money management, the better it is for them when they become adults.