Teaching Kids Financial LiteracyFriday, January 09, 2015
While I've never really been a big spender, I am definitely guilty of poor spending habits such as buying a coffee every morning or going out to buy lunch instead of making my own at home. And yes, from time to time, I may splurge on something really nice but hey, YOLO, right? As the chief financial officer of the household, I am primarily in charge of paying the monthly bills and keeping our accounts in check but managing the family budget has never been my forté which is why I'm always grateful for money-saving tips. It's one of the reasons why I want to marry Gail Vaz-Oxlade. Anyone who can simplify money matters is always a friend of mine.
Now that my children are growing up and taking on more responsibilities, I feel it is even more crucial to set a good example for my kids when it comes to money. Each of them have their own bank account and debit card, and whenever they receive a monetary gift from grandma, they are now the ones to deposit the funds themselves. With mommy watching over, of course. We also talk more openly about certain financial matters in the hopes of instilling an importance on saving for the future.
To help manage the family budget, RateSupermarket.ca offers free, up to date information on the latest personal finance offers, guides, tips and helpful articles. They also want to help moms and dads teach their little ones about spending, saving and personal finance and have shared a few tips to help educate your little ones on financial literacy.
Five tips for teaching your kids about money
- Start early. - Start as soon as your children are able to count and make money the topic of regular family discussions. And make it fun! Play a round of Monopoly or The Game of Life to teach the importance of making smart money decisions. Monopoly can help children learn the importance of budgeting and setting aside an emergency fund. The Game of Life demonstrates how focusing on education can increase earning potential.
- Want vs. need. - Don’t give children everything they ask for and don’t feel guilty about it. I know this is a tough one but it’s important that children understand the difference between needs and wants, and that they may have to wait to buy what they want. This will help encourage them to make sensible spending decisions.
- Teach your child to save regularly and plan purchases. - Set up a process for saving money, whether in a piggy bank for young children or a bank account if they’re older. Regularly monitor to see how much they’ve saved and introduce goals for saving and planning larger purchases. You can find out which bank account on the market is best for your child's needs here.
- Money means choice. - Money is a finite resource, and therefore it is crucial for children to learn how to make wise choices about spending. If your kids are young, during story time read them a book that teaches the basics of budgeting and saving. Remember to chat through lessons-learned at the end. If you have a young adult, test out the Rewards Calculator on RateSupermarket.ca. It's a quick, four-step tool that identifies which available credit card provides the best rewards for your needs (cash back, travel, gas or specialty rewards) based on your current, everyday spending habits.
- Lead by example. - As a parent, you have a great deal of influence on your little ones, especially when it comes to financial habits. Children have a tendency to copy their parents’ behaviour, so be open about your spending habits and savings goals, and try to limit the amount of shopping trips you take as a leisure activity. They might start to think money is unlimited and spending is fun.
To help you teach your little one about spending, saving and personal finance, RateSupermarket.ca is excited to offer a fun-filled prize pack with educational games & books valued at $75.
The #RSMrewards Financial Literacy Prize Pack includes: