Tuesday, March 8, 2011

The Most Effective Methods To Teach Children About Money Today

By Travis Rose

There is nothing a parent can do for a child that will be more meaningful than to teach them how to manage money. Many parents feel that this should not be something for children to worry about when they are young but that is the time to teach kids about money.

It is important that the child understand the difference between routine chores and jobs that earn wages. Cleaning their room or making their bed should be expected as part of the living process. While doing something such as feeding a pet or raking leaves in the year is a money making task.

An allowance can be used as a way to impress financial values but, again, it should be earned. This should start as soon as they know that cash is required to purchase things they want. This requires consistency, patience and a great deal of reinforcing the ideals of financial management by the parents.

Families who are trying to teach their child the value of money will have a routine that is faithfully followed. On payday the family gathers around the table and the wages earned are produced. At that time it is divided into certain sections as to where it should be applied. This educates the child to the fact that income earned is paid out in certain ways and is not just to spend foolishly.

On this 'payday' the funds are divided into envelopes or other containers specially marked for certain projects. Things such as savings, church or charity, toys and so forth will encourage savings. If, for example, a certain toy is desired they will understand that they must have that amount in the toy fund before such a purpose is possible. It will not be long before they understand the connection between earning wages and dispersing it wisely.

If one wants to teach kids about money it should be started at an early age, usually around age five, although it could be later. By teaching them that nothing in life is free, they will receive one of the best educational experiences of their life. It is something they will unconsciously carry through their entire life when it comes to financial matters.

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