Today we will discuss kids and money. Also, we will take a look at the importance of pocket money for kids and why it is necessary.
Many parents have questions related to money, whether to give a child pocket money, whether children need it. And if to give, how, and how much? Isn’t it harmful to encourage good learning with money, is it necessary to control their spending? Happiness and success in life comes to those who cannot only make money, but also manage them rationally. Therefore, it is a good idea to teach children the right attitude to money from an early age. Financial education should be done, after all. Often, however, we can’t quite figure out how to deal with finances ourselves-and we can’t tell our children about them properly. Here’s a look at some of the most popular parents’ misconceptions about money.
Why Do You Need Pocket Money, You’re Just A Kid?
“I’ll buy all the necessities myself, it’ll be easier,” you’ll say. Easier, but not better in the long run. What we were taught as children, we repeat automatically in adulthood – and it’s great if it’s not just knowing how to tie our shoelaces, but also how to handle finances competently. That’s why pocket money is a great benefit for children and parents alike. Managing their own budget teaches children to buy what they really need, to put off their momentary impulses, to save, to distribute. Every parent’s dream – a trip to the store without obsessive requests – becomes a reality. An understanding of the value of money is formed: it is treated more carefully. Plus, the child hones his or her counting skills this way.
The ability to appreciate, save, and manage a budget is formed gradually. This is a long and hard work, so it is better to start as early as possible. Already from kindergarten age it is useful to give your child small amounts of money and specific tasks – for example, “choose your own ice cream”. And 6 years old is a great age for a full-fledged start. “When giving out pocket money, don’t let the situation continue on its own. Be sure to ask for feedback: ‘Tell me how you spent your budget this week.’ As long as the child is small, he will gladly share with you (especially if you praise him for successful decisions). If you drag it out and start this story as a teenager, however, you may encounter a lot of resistance: “I’m independent, I won’t report to you.”
We Have No Money
Imagine – you came to the store for something necessary, and the child urgently needs another toy. “I won’t buy because we don’t have the money” is a very common and completely ineffective argument. To begin with, this is not true. The child sees with his own eyes how you take out your wallet, pay for your purchases – and there is money in it. The result will be a child’s tantrum right at the checkout – or just incomprehension, resentment and a feeling that his interests have been neglected. To get out of this situation intelligently, remember the strategic goal – to teach how to be conscious about spending. To do this, explain to your child that there are different categories of purchases: what you need to buy right now and what you want, but it can wait.
Before going to the store, always agree on what you plan to buy. If the child wants something “above the program” postpone the purchase to another visit to the store. Only be sure to fulfill your promise: If you promised to go for chocolates on Friday, go. Knowing that the time for his “wants” is guaranteed to come, the child will be more relaxed about the idea of putting them off. In the future, this skill will allow him not to squander his entire paycheck in the first few days, looking for the best time to shop and save up.
We’ll Pay You for Good Grades
Pocket money and grades are very different categories; you shouldn’t mix them up. You shouldn’t pay money for good grades and “fine” for failing. It’s better to honestly explain to your child why you need to study well – and that it’s primarily in his interest. “If you pay a child for his grades, he may develop the belief ‘if I study well, I’ll definitely have a lot of money.’ But that’s not true: A great education doesn’t guarantee at all that you’ll become a millionaire (or even find a high-paying job). You shouldn’t raise false expectations of life, then there won’t be any unnecessary disappointments. But the opportunity to earn extra money is useful. This allows the child to feel “the price of money”, to understand that it does not fall from the sky, but comes from work. Get ready to pay every time you have to do the same job again! You have entered into a kind of employment contract – and you cannot break it.
Be consistent and do not undermine the trust of children. Remember also about the long-term consequences: you don’t want your growing child to think that if the boss is cursing, it’s okay to work late. Giving freedom doesn’t mean being completely self-effacing. Regularly ask your child to share how he or she handled the budget. Be sure to highlight good decisions, don’t hold them to account or criticize them. Remember, every child (and especially a teenager) goes through meaningless spending sprees. If you respond to them correctly (not by cursing loudly, but by quietly sorting them out and advising them), every mistake will be a stepping stone to practical learning.
How to Give Pocket Money Properly
· Agree on the conditions. You can fix them in a written contract – so the child understands that he is treated as an “adult”.
· Never punish by deprivation of pocket money. Even if the child has done something wrong, keep your promise.
· Don’t give too large amounts – so that the child can learn to save. It’s easiest to ask parents of classmates how much money they give, and be guided by this amount.
· Give opportunities to “earn” more pocket money by doing some special tasks.
· Don’t pay for good grades or daily household chores.
· Regularly ask your child to share how he or she has spent his or her budget. Be sure to celebrate successes, not just mistakes
· Discuss finances in a calm way. Even if your child wasted all the money on nothing, noisy squabbles won’t do any good.
· Accept the fact that the child will decide for himself how to spend his money. You can only advise and guide.
Give Out Money Regularly
One of the best ways to teach budgeting is to give out pocket money not daily, but weekly or even (in the case of teenagers) monthly. Of course, this point should be made after you understand the structure of expenses, learning to divide expenses into necessary and additional.
Having received a certain amount of money for a week in advance, the schoolchildren will have to prioritize their own money, distributing it so that it is enough for basic needs – and to buy a ticket, and to pay for school lunches, and for minor joys.
That’s It!
Remember that the most important example for your child is you. Money is an important part of our lives, but few parents are able to openly discuss the subject with their children. We teach our children how to use a fork, how to cross the street, and how to communicate politely, but somehow, we hope that they will figure it out on their own.