How to Teach Your Children The Importance of Money?

Money doesn’t shower from skies, like raindrops. It is hard-earned, and it is very crucial to teach your children the importance of money, and proper financing. These learnings would come in handy, when they grow up, and become independent.
Five or six year old’s start to acquire the cognitive skills required to grasp basic monetary concepts, such as recognizing coins, finding out how to collect cash, and matching small sums of money to things they want to purchase.

Here are some activities you can do, to teach your children the importance of money and savings:

Teach Children How to Save Money:Teach children importance of money by saving

Take your children shopping with you, teach them about sales, and offers. Teach them how coupons can be used, how buying something in bulk can be an economically better option. You can also make them save up for a toy, or something they want, so they can understand how each penny counts, and they feel grateful for having resources. Get them a transparent piggy bank, so they can see their money grow.
Give them pocket money: Now, this is entirely up to you. You can give them a set amount of money each month or so, or you can also reward them, for completing small tasks like keeping their room clean, getting good grades, finishing homework, eating their vegetables, etc. This would induce good behavior, as well as teach them the importance of money. They would get to know how hard earning money can be.

Make a Monthly Budget :
teach children importance money by making budget

If you are giving them pocket money, you can also set a minimum limit (as in bank savings account). They would have to maintain that minimum balance, so they would be able to manage their expenses better.
It should be enough for them to buy minor items, such as trading cards, hair clips, or ice-cream bars. The next time you go shopping, tell your child to bring their money if they think they might want to purchase something. What if your child has spent their weekly/daily allowance and still begs for ice cream? Tell them to wait until the next allowance day.

Play Shopkeeper Game:

You can keep some household items, like pulses, rice, ketchup, etc, or maybe their toys on a table. You can become a shopkeeper, and tell them to come buy stuff. Give them minimum requirements: rice, flour, etc. are essentials that they must buy. They can decide the quantities. Give them a budget, so that they learn how grocery shopping pairs up with saving and budgeting.
This would also pair up with basic mathematics they learn at school. Explain to them how they can balance the requirements: for example, they buy rice, pulses, flour, etc., now they have an option between 2 balls and one pencil, or one ball, three pencils, and a chocolate. Let them choose how they want to budget their finances.
Help them count up the right amount, when your child decides to make a purchase. Have them hand the cashier money, and wait for the change.

Teach Them Difference between Need and Want:
teach children importance money by telling what they want and need

Teach them how food items like rice, pulses, etc. are essential, whereas chocolates and treats are non-essential. A balance must be struck between needs and wants, in order to manage resources and finances effectively.
Always advise your child to make smart spending and concentrate on saving money. With one of your own personal experiences, you can tell them how you saved money to acquire one useful item. It will take time, every time they fish their pocket for money to buy something, you don’t need to watch over your kid. Encourage them to make independent decisions about making money – while evaluation is something you can support them with! This is not a smooth road but it will eventually be figured out by your kids.

Money plays an important part for the specific reason of our lives. If our basic need will be fulfilled, or live a comfortable life. It plays the main role in the various fields, such as education , health, to satisfy the basic needs of our lives.

This month ,I am participating in Blogchatter’s #MyFriendAlexa Blogchatter” and I’m taking my blog to the next level..You can read my posts with hashtag #Gurjeetwrites.”

October 12, 2020

14 Replies to “How to Teach Your Children The Importance of Money?”

  1. Srikanth says: October 24, 2020 at 7:53 pm

    Good read, children knowing the value of hard earned money, budgeting it and spending according to necessities is becoming very important in todays world. Thanks for sharing some tips..

  2. Aseem says: October 21, 2020 at 4:10 pm

    Some interesting points there. I think it’s must very important to make children understand the value of money from an early age.

  3. Dixita Agarwal says: October 21, 2020 at 2:37 pm

    Teaching kids at an early age helps them learn better, very useful advices suggested

  4. Cindy Dsilva says: October 21, 2020 at 1:45 am

    Oh yes. We have taught the older one about need and want and she’s smartly throwing it back into our faces. Shopkeeper is their favourite game.

  5. Haimanti Bhattacharjee says: October 20, 2020 at 11:11 pm

    You have jotted down some great ideas… I feel teaching them the difference between need and want is extremely essential as in today’s life they get more or less everything they ask for…

  6. JAYSHREE BHAGAT says: October 20, 2020 at 9:56 pm

    My kiddo is 6 and still has no value for money. We try our best to do it. These tips may help. Thnx

  7. vidhya Thakkar says: October 20, 2020 at 11:56 am

    That’s an interesting way to teach them! Bookmarking for my nephew

  8. Amritha Srinath says: October 20, 2020 at 12:26 am

    This is one of the best post I have come across on how to teach our little one’s the importance of money. These activities are indeed engaging and impart so much learning to kids. Using their cognitive skills through play like shopkeeper is indeed very engaging too.

  9. Aditi Kapur says: October 19, 2020 at 11:13 pm

    Kids of today don’t know the value of money. It becomes our responsibility to teach them the basic concepts of spending carefully and saving for future.

  10. Nitisha says: October 19, 2020 at 9:34 pm

    Brilliant ways to teach children the importance of money. Thanks for sharing, Gurjeet.

  11. Kinshoo Agrawal says: October 19, 2020 at 9:09 pm

    Very important and practical points. We are trying to make him understand difference between want and need. Making note of this post.

  12. Harshita Nanda says: October 19, 2020 at 8:34 pm

    I wholeheartedly agree with your post. Children nowadays have too much leeway and are usually clueless about money. It is an important life skill which the children should know and learn. while I don’t give pocket money to children they do get money as a birthday gift. I always ask them to save it or they will spend it all on ps4 games

  13. Atulmaharaj says: October 19, 2020 at 7:04 pm

    A topic that is close to my heart, I always feel that kids to be taught about money at a young age. And the best way to start is to teach them about essential and non essential items and the concept of money and eventually talk about value of money. If these teachings are given at a young age they will be able to manage money better in their lives.

  14. Dr. Rahat Sayyad says: October 19, 2020 at 3:57 pm

    Thats a lovely resource on teaching finances to kids.

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