Ensure your child understands the value of money!!

Children being the most innocent beings of all are quick to copy and emulate everything that adults do. It is very simple to mold them into following bad habits as well as the good ones. All it takes is a little discipline on part of the parents. So let us look at simple habits that you can follow and hence instill in your child to make him financially responsible from the very beginning.

 

Splurging on excess: As the child see’s new, big and shiny items coming into the house very often, he believes they are easy to buy! From there it’s a down trip wherein he asks for everything he sees. The easiest way to avoid this attitude is by ensuring you do not splurge on excess vanities very often. It is very important to show the child that it is not easy to buy everything we want.


Wastage: Does your child waste too much food? Does he break and throw away new toys and then ask for new ones. It is probably because he has seen someone do the same. If either of the parents gets away by wasting food or paper or anything else, the child is likely to emulate. And in today’s time when food items are facing the highest rate of inflation, such wastage can cause a big hole in your pocket. Instead make a rule to finish everything on the plate, ensure it is applicable to each and every member of the house and then watch him finish every last morsel.


Money over time: In most houses today both the parents are working and children often grow up feeling lonely or uncared for. Parents try to fill in their gap by excessively pampering the child when they are around. This involves buying whatever the child puts a finger on. But is this the right replacement? You should try and spend as much time with them as possible and mostly explain to them why exactly you need to be away. Tell them that if they want a brand new toy, it would mean an extra hour in the office for you and one less hour with them.


Buy one new item, cut down on 5 others: Kids often ask for expensive items such as Ipads and mobiles etc. They do not understand how much money they actually cost. For them it is simply a toy. So why not teach them its value. The next time they ask for an Ipad, maybe you can try telling them ‘so we will buy the Ipad, but then we won’t have any money left for your happy meals, so we shall not go to Mc’donalds for the next three months. Is that ok with you?’ This could help the child understand that if he gets one thing, some other thing will be taken away.


Let them earn it: Kids often ask for new things. And as parents we must give them all the joy and happiness. But maybe sometimes we should let them earn it. They want that new toy in the market they can have it once they finish their exam. They want to have ice cream they can have it as soon as their room is clean. This way they know they have to work hard to earn something.


Money management tips: Buy your child a piggy bank. Encourage him to put money in it and then when he wants to get something, let him use a part of his money to buy it. This will make him feel like he accomplished a task and also will encourage him to save further for himself. You can also instill the habit of saving from a young age.


You can explain to him the concept of a bank and savings account by calling it a ‘big piggy bank’. Tell him for every Rs.10 he saves in the big piggy bank, he will get Rs.11 back, in simple words the concept of interest. This is basically the idea of saving for a specific goal as opposed to spending money right away.
Kids being simply followers of their parent’s footsteps are the easiest to mold. We must take this opportunity to instill and educate them with the simple ideas of saving and spending, value of money etc. so in the future these prove beneficial.

 

By Shalmali Kulkarni.

The writer is working as a para-planner with Fpguru.com

 

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