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5 Tips to Teaching Kids and Teens About Money

Saturday, January 23, 2010 2:00 PM Posted by Kids and Teens

By Marianne Lewis


It is so important to teach children about money and to help them develop money management skills and financial habits that will last a lifetime. In today's world of rising debt and easy credit, it is crucial to start teaching children about money early and to prepare them to stand firmly on their feet later on in life.

So consider the following questions:

* What can you start doing to ensure that you are raising money savvy children?
* As they grow into young adults, will they spend within their means, avoid unnecessary debt and make informed and wise consumer decisions?

The fact is that children want to learn about money! Recent statistics show that "94% of youngsters believe it is important to know how to manage money, but only few say they are taught how to!"

Getting children in the habit of saving instead of over spending can, and should start early in their lives.

Here are 5 tips on how kids can be taught to set goals, plan, budget, save, invest and spend wisely:

* Teach by example: Children do learn by example, you will be giving your kids a very poor example to follow if you make frivolous purchases every time you have some extra money. So controlling your spending and sticking to a sensible budget and your children will learn to do the same. Be a good role model.
* Explain the difference between wants and needs: Help children know the difference between wanting stuff and having needs. And also the pleasure gained in saving and eventually spending on things they want.
* Teach the value of money: Take kids along on grocery shopping trips and talk about how to become savvy shopper and bargain hunters.
* Encourage kids to shop sensibly: The best way to reinforce what you teach your kids is to have them practice saving and spending. They would learn a lot quicker from spending decisions, whether good or not so good.
* Encourage kids to give: Teach kids about giving to charity, giving tithe and offering; and generally being aware of the needs of the less fortunate. And how their contributions, no matter how little can make a difference in the lives of others.

It is better to invest in teaching kids how to save, give and spend wisely NOW than to teach them how to GET OUT OF DEBT or deal with the consequences of the wrong financial decisions LATER on in life.

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