Friday, 7 August 2015

Money Habits to teach your children


It’s amazing how quickly children grow – one minute they’re tiny babies, depending on you for absolutely everything, and the next they’re fully fledged little people, setting out on the adventure of growing up.

And, because childhood seems to be a blink-and-you-miss-it kind of time, it’s not only important that you cherish every second of it, it’s also vital that you start instilling into your little ones the attitudes and behaviours that will put them in good stead when they venture out into the big, wide world.
Recently, I’ve been trying to make a concerted effort to teach my children good money habits. Don’t get me wrong, it’s something that I’ve always tried to do – but now I’m making a solid and conscious effort to get it right!

A friend of mine recommended this really great money advice video from Mrs Moneypenny – she’s got some great tips, and they gave me a really good starting point.

Set a good example It goes with out saying that the majority of your children’s spending habits will come from you – so make sure you practice what you preach and set a good example.

Pocket Money


The amount of pocket money that you should give your child is a question that I’m sure has been troubling parents all over the world for decades, if not more.
The fact is, there is no easy answer to this question; it’s completely down to your personal preference (and your budget, of course).
Mrs Moneypenny suggests giving your child one pound for every year of their life – so if they’re 10, give them £10 per week or month, if they’re 7, give them £7. I’m trialing this approach with my little ones and it seems to work really well, especially when they get a pay rise on their birthdays!




Budgeting



When it comes to teaching them the importance of budgeting, it’s never too early! I think it’s so important and it sets them up to be good money-managers in their adult life, so I’ve always encouraged my kids to save their pocket money and budget it, so that they can afford the things they want – whatever they may be.

One thing I hadn’t thought of though is getting them to split their pocket money three ways. This is one of the things Mrs Moneypenny suggests and it’s something that I’m definitely going to introduce in my household.

The way the concept works is by getting your little ones to split their money into three parts – one third to spend on something they want now, one third to save for something they might want to buy or do in the future, and one third to give to charity. This sounds like a great way to teach them good saving habits and I can’t wait to give it a try!

A few years in the future…


Although it’s probably not one for your toddlers, when your children start to reach their early teens, it’s a good idea to start introducing them to the concept of their credit report. This might sound strange, and to be perfectly honest it’s not something I’d considered before I discovered Mrs Moneypenny, but when you think about it, it’s a really worthwhile activity.
After all, it’s one thing telling your children about the impact that their financial decisions can have upon their future, but it hits home far more if they can see it for themselves. So take some time and go through their report with them, explain the things that can affect it, and how a negative report might well cause them problems in the not too distant future.





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