A-Z of personal finance: K is for kids

Give them an Allowance
A regular allowance or “pocket money” is often a child’s first experience with financial independence, as it gives them a certain degree of control over their own money and provides an effective learning opportunity in earning, budgeting, saving, and prioritizing purchases. Children should have some money of their own so they can learn how to manage it.

Learning to Earn
Some parents pay their children for doing chores around the house, whilst others prefer to give an allowance with no strings attached. Try not to tie chores too stringently to allowances, as this can make children feel that being paid for helping out at home is their right rather than their duty. Some parents soon fi nd themselves having to negotiate to get anything done!

Encourage your teenagers to earn. Children tend to be much more disciplined and careful with money that they worked hard for than with their “free” pocket money or allowance.

Teach them to Give
Instead of giving them too much, encourage your children to give of themselves to others. You can provide opportunities for them to be caring, giving and sensitive human beings. Involve your children in your financial decisions regarding philanthropy and expose them to charitable giving early in their lives. Children can donate their outgrown toys, books and clothes and as they get older, can volunteer of their time and talent.

Be a Good Role Model
Action speaks louder than words. Your children will learn about money values primarily through your behavior; they learn from what they see, hear, and experience. The way you deal with money issues, from settling bills to making a large, affordable purchases, are all-important lessons that will remain with them.
Bringing up children to develop a healthy attitude towards money as they grow from childhood to adulthood is a challenging yet rewarding process that requires some commitment and consistency.

Too many of us look back on life and wish that we had started investing when we were young. Begin early in your children’s lives to instill in them the important building blocks of saving and investing and