Kids and Money by Adam Mortimer
I believe that every parent should strive to teach their children the principles of living a prosperous lifestyle. Wise parents know that this knowledge is one of the greatest gifts that they could ever give their children. If we are trying to teach them how to handle their money, it is crucial that we are leading by example. Teach them that they can accomplish anything that they want to accomplish in life and especially when it comes to their finances. Teach them to avoid debt except for some things that cannot be avoided like a mortgage, car, or education. Everything else should be cash only. Teach them through example. Let them see you make wise financial decisions like saving for a rainy day. There is a saying by Harvey S. Firestone; “A man with a surplus can control circumstances. But a man without a surplus is controlled by them, and often he has no opportunity to exercise judgment.� Every family should have a reserve of at least 3 to 6 months living expenses. Teach them the dangers of Debt, the power of compound interest, and living within your means and paying yourself first. Let them see the family budget. Let them see the money coming in and the money going out so they can better understand cash flow. All too often I hear students say that there parents never taught them how to manage money.
Talk to your kids about money. Not talking to kids about money is the worst thing that we can do as parents. Money should not be one of those things that we should not shy away from. Involve the family in saving up for things like vacations. Even if your kids are not able to contribute a lot, this will give them a real sense of accomplishment, and can help to build self esteem and confidence when it comes to money. Let your kids have their own savings account. There are a lot of great high yield savings accounts that would be great for this.
Never give you kids a sense of entitlement. Teach them to work for their money; do not just give them something unless they have earned it. Earning a dollar will help them appreciate it more than if it is just given to them. Is there a lawn that they can mow? Can they clean the kitchen and do the dishes. Teaching kids these fundamental principles can go a long way to raising independent adults.
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