Children, and particularly teenagers, are more financially aware than ever.?? Parents are sometimes unaware how knowledgeable their kids are about money and financial issues.? However, this is an area of life in which children and teens need support and guidance in order to help them recognize the benefits and responsibilities that come with financial decision making.? To help your kids develop healthy attitudes to money encourage them to discuss their ideas about money with you and give them opportunities to try out some financial planning of their own.
Teach budgeting
Budgeting is an essential life skill which should be encouraged from a young age and reinforced as children grow older.? Everyone needs to budget, not just for household expenses but many people will need to tackle budgeting in their working lives.? The sooner kids can be part of this process the better so they can learn the key skills needed for good budgeting.? They are then set up for life and have the reassurance of knowing they are able to plan their finances so they can have better control of them and use them most effectively.
Simple ways to help them learn about budgeting include sharing grocery shopping with them, give them a total spend amount, tell them the items which are absolutely necessary then give them a small amount to choose how best to spend it for the family.? Another way is to give a set amount of holiday money or pocket money which they are allowed to spend over a specific period of time.? They can choose how they spend it but if they run out they must know there will be no supplements.? Likewise should they choose to save it, they can keep track of their accumulating amount and can be encouraged to save towards a particular total.? By agreeing goals to earn or save, and giving praise when they reach them, it teaches the benefits of saving and the enjoyment of working towards an incentives goal.
One of the most important aspects from this process is to let them make mistakes, they will learn a huge amount from running out of cash part way through a holiday or from buying things they later realise they did not need.? As they get older give them an idea of how much rental, mortgage or energy costs are and discuss the entire household budget with them so they are prepared for the reality when they leave home.? One of the key areas which can help your kids is identifying and distinguishing between essential items and ?nice to have? items.? By discussing their budget choices and helping them create lists of what they want to spend their money on there is the opportunity to distinguish between their needs and desires.
Communication
The key element to helping your kids or teens have a responsible approach to money is to establish good communication on the topic within the family.? Through regular communication with your kids on this topic you can discuss your family?s particular morals, ethics and boundaries when dealing with money issues and emphasize that with money comes responsibility.
Children will be interested in your financial situation so it is good to be honest and open, while reassuring, about your approach to finance.? Many parents wish to shield their kids from the family?s finance issues, especially when there are difficulties.? However, it can help your kids if they feel involved in the family?s financial decision making and know what to expect.
* Please call 911 if you are experiencing a life threatening emergency and or go to the closest emergency room.
Source: http://www.drwendyschwartz.com/Los-Angeles-Marriage-and-Family-Counseling/kids/kids-teens-and-money/
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