There are a lot of basic values and practices every parent needs to inculcate in the lives of his or her kids, young as they are. These include eating healthy, how to treat others right, how to deal with problems, and more. But probably one of the most vital things parents need to pass on is the principle of earning, budgeting and saving money. Here are some ways on how you can teach your kids to save.
1. Teach the value of waiting. Many people find it so hard to save because they are not patient enough to wait for the right time to buy something. Often, when something captures their fancy, they buy it then and there, not taking into consideration certain factors that should be considered. Some questions to ask before buying something: Are there more important things to address and purchase at the moment? Will I be able to save more or get a better deal if I buy this in a few months’ time? Will I be more confident of buying this in a few months’ time after I have really saved for it? Compulsive buying is one of the fastest ways to run out of money, so make sure you teach your kids to avoid getting into that habit.
2. Stress the importance of saving a percentage for every money received. Every time you give your kid an allowance, encourage him or her to put some of it in a piggy bank or savings account. This is one good practice they can take with them until adulthood.
3. Differentiate between wants and needs. Communicating to your kids your own spending values and priorities can make them more discerning in spending. For instance, you can explain why you think certain things are just a waste of money or should be least prioritized as compared to the basic needs. At the same time, share how you indulge once in a while in a few wants and why doing so is okay as long as the basic needs are considered first.
4. Encourage your kid to keep a record of everything he spends and saves. This way he can monitor his daily spending habit and know which stuff he tends to spend too much on. Recording saving and spending habits also make it easier to set and reach goals.
5. Teach the value of hard work. Explain to your kid why money is not something easily obtained and that you worked and continue to work hard for everything you have. You can also have a incentive system for your kids and reward them whenever they work hard for school or for an extra project.
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