How To Teach Your Kid Money Management
Give The Kid An Allowance
It’s difficult to teach a kid money management without giving him some real money to manage. So, give him a monthly allowance and ask him to buy all those candies and toys with that money for the whole month. You can help him with the calculations at this stage. Make it clear to him before that he will not be given any extra money for the rest of the month. Declare a reward if he can manage with the given money for the whole month.
Teach Saving
Once, the kid is able to manage with the allowance, give him the target to save something. Get him a piggy bank for the coins and a wallet for the bills or you can arrange a locked box. Tell him to keep aside something everyday. Repeat the exercise every month.
Set Goals
It’s time to teach your kid setting financial goals and the difference between short term and long term goals. Tell him he needs to save to buy a new shoe next month and simultaneously he needs to save for that bicycle he’s planning to ride in the next summer holidays. Help him to divide the daily saving amount between the short term and long term goal.
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