Children and Finance: Why Financial Education is Important for Them?
Children have a long way to go and a lot to learn. What is the need to educate them with something as complex as finances so soon?
If that’s what you think always, then you’re probably making a big mistake. Somehow or other, we must all relate to money at some point in life. As simple as it may seem, money has the power to affect the way we relate to others as well as ourselves.
You may have seen many parents tell their children that ‘I feel sorry for them because they have little money and have to choose between going to the movies and popcorn or going to the movies and having a snack’. But this is a vital lesson.
In life, you have to learn to choose and they have to be aware that money is limited.
If you’re still wondering why it’s important to teach kids about money management, then this article is for you. Keep reading!
1. They don’t deserve everything in life
They’re kids, you know they’ll ask you to buy everything they like and give them every possible stuff. Here’s your chance to sit down and talk to them and teach them that having money is not about buying the first thing you want at the moment and that luxuries should be very occasional and if they really want them.
Tell them some of the ways you manage money and how lucky they are to have it. If you give them everything they ask for instead they will become impulsive and unthinking which can lead to serious financial problems in the future.
2. They can become more generous
Once they understand that money must be cared for and well managed, tell them a little about the children who have not had the same opportunities as they have.
A good way to do it?
Take them at least once a year to orphanages or associations where they can live with low-income children or every six months encourage them to donate a toy. Convey to them that concern for improving opportunities.
3. They will be very simple
After denying them many whims and talking to them multiple times about money (you’re going to need a lot of patience), you’ll realize that dealing with their friends and classmates will be very positive because there will be children who know that generosity is worth more than having all the material things they want.
You spend some time communicating to them lessons about finances and savings and investment strategies. Be an example to them, because example is one of the best ways to educate.
4. They will achieve their goals
Once they are accustomed to avoiding impulsive spending and make a habit of moderation, they will be able to work with greater focus and have better strategies for meeting their goals. They may be very young, yet you should start investing time in their dreams even if they are not yet very well defined.
Remember, children are the future of the country and the economy; so give them a little push for change. It’s good to teach children the value of money from a young age, even if they have tantrums. Children are great observers and from a very young age they begin to be aware that their parents use money as a bargaining chip. Taking your children for shopping is a good way to instill in them the value of money.
As Nelson Mandela said,
“Education is the most powerful weapon you can use to change the world.”
This article has been written by Chandra Mehta.
Chandra is a seasoned banker with 35+ years of experience in banking and financial services industry. He’s a retired banker and has served as Chief Manager and Assistant Vice President in State Bank of India/or its subsidiaries. He has authored many articles on this site (allonmoney.com).