05 Feb 2021 • 3mins • Yolt

Money school – teaching your kids how to manage money

Tags:
Teaching your children how to manage money

Does pocket money burn a hole in your child’s piggy bank? Here are some fun and easy ways to help your kids understand the value of money and develop saving habits that will stick with them for life.

1. Make money physical

It’s easy for money to seem like some made-up excuse for why they can’t have that toy or those sweets if kids never actually see money – especially when credit/debit cards and virtual payments work like magic.

Touching and using cash makes everything more real. Let your little ones play with coins and when they’re learning numbers, teach them the value of coins and notes. Giving kids their own piggy bank is an easy way to start the money conversation and introduce some responsibility. Talk about why it’s important for them to keep their stash safe, then count it together so they learn to keep track of how much they’ve got banked.

2. Teach money decision making

The earlier kids start making money-related decisions, the more confidence they’ll have in managing their own money. When you’re out shopping, talk about why you’re choosing certain products over others and how to spot deals that might save a bit of money.

At home, talk about what they can do with their pocket money and help them make their own decisions about how much to spend or save, when, and on/for what.

3. Set limits on spending

Unfortunately, money doesn’t grow on trees. Setting a budget is a great way to teach your kids that money isn’t endless. For younger kids, you could get them to plan their own lunches in the school holidays. Tell them how much they’ve got to spend, get them to write down what they want, and then see how much they can get for their budget.

With older kids, you could do this with a day out. They’ll need to think about how to get there, how much activities and food will cost while you’re out, and if there’s anything they can do for free to have fun without breaking the budget.

4. Get them saving

Kids aged 7+ generally understand the difference between wanting and needing something, and kids a couple of years older will be wanting more independence. This is a great time to start them saving. Get them to think about what they want to buy and how much they’ll need. Then work out how long it’ll take it them to save up enough, either by saving some of their regular pocket money or earning money by doing chores.

You can make a progress chart to see how their savings are building up, and encourage them to keep going by adding stickers or mini-rewards at key stages.

For grown-up money management, Yolt does all the hard work for you. Set your own budgets and saving Goals to keep track of everything in one easy app.