Financial Literacy: A Session for parents.

Tools To Make Kids Financially StrongBy

Dr. Nicholas CorreaTrainer, Ratnasagar Publication

When it comes to kids and money, many parents are clueless.

After all, financial literacy is the last thing in children’s mind.

How do you teach kids about money?…

Money lessons are one of the most important lessons in life.

The sooner a person learns to value money, the greater are the chances of him having a comfortable life.

These lessons should be imparted at a young age, and to do so, parents should come up with interesting tools for kids to understand and remember the importance of money and the benefits of smart saving.

Let’s have a look at some of the easy and effective tools to learn save money

Create a chartParents are the first teachers of kids. So the parent should take great care of what they portray to their kids.

If children see their parents saving money, so will they. To cultivate this habit in younger, one should make a reference chart on how much to save.

An easy calculation would be 10 percent of earnings should be saved. So when the kids get

Put money into piggy bankKids who are small enough and don’t understand the value of having a savings account in bank should be provided with a savings account at home.

And the best way is to have a piggy bank. The habit of putting money into piggy bank and counting the savings after regular intervals of time would excite a kid to save.

Parents should always keep handy some change, so that kids look forward to have a coin from you and put it in their piggy bank.

Avoid impulsive shoppingGroom your kids to have patience and not indulge into impulsive shopping.

This habit can be cultivated over time by putting a pause between the kids and their favourite purchase.

This would give them time to think if they really want the item. If the kid forgets and do not crave for that item anymore then it would mean the kid just wanted it and does not need it.

Visit to the bankKids love to act like elders as much as elders love to go back in time and become kids again.

A mere sense of responsibility excites children and a productive way of using this human phenomenon is to take them to bank and open a savings account in their name.

The feeling of possessing an account in bank would be enough to raise a sense of responsibility in the kids and would encourage them to save money.

Maintaining one’s bank bookAnother motivational way for kids to save money is to let them calculate their savings and maintain their own bank book.

This would allow the kid to see for himself how his money is growing and would instil a feeling of responsibility.

Kids who are old enough to do the simple math would not only maintain their own bank book but would also be interested to make simple investments to grow their money.

Making a listOne way to curb unnecessary spending is to teach your kids make a list of items that they need.

By doing so they would be able to differentiate between their needs and want and stop impulsive spending.

This habit is not only useful for kids but should be followed by adults as well.

Resist futile spending and say ‘No’One of the most important lessons that a kid should learn at a young age is to understand the difference between want and need.

Most of the times, children cannot resist spending money in things that they don’t need and sometimes don’t want. But the presence of money in their pockets prompts them to spend it.

Once children learn to say ‘No’ to themselves and understand that expenditure should always be related to need, they could help themselves resist futile spending.