Teaching a kid about money is very significant. It helps the kid to be responsible and have self esteem. It also enables a kid to know the best way to spend the money that he or she has earned wisely. Below are some things that a kid should know about money.
1. Saving from income
It is very important for a kid to develop a habit of saving. The best approach is to advise a kid to save at least 10% of his or her earning.
2. Don’t borrow more than what you can pay back
Debt is one of the leading causes of depression. It is important to let the kid know that it is mandatory for one to pay back what he or she borrows. It is also important for the kid to know that a debt can make him or her to be anxious and stressed. These are some of the causes of heart problems and lack of self esteem. Let the kid understand why an indebted person is unlikely to get rich.
3. Giving out is getting more
It is important to let your kid know that managing money is not the same as hoarding it. The kid should know that money has to be spent wisely and with a purpose. Let your child understand that donating money for good course is a noble undertaking.
4. Money is not evil
There is a common say that money is the root of every evil. You should ensure that your child is not imprisoned by this say. Money has brought good things to human life. They include the creation of wealth, investing in business and donations to charity organizations.
5. Spend less lose less
One of the earliest philosophies about wealth creation is “it takes money to make money”. However, it is also possible that it takes money to loose money. It is important to let your kid understand the value of money and the need to be cautious while getting into business deals.
6. Get the best price for everything you can
What defines ones financial help is the amount he or she earns as compared to the money that he or she spends. Let the kids also know that by bargaining it does not imply that one is a miser.
7. The fast buck is your last buck
It is important to let your kids understand the importance of creating wealth. However, let them understand that it is a life time process that is based on common sense, discipline and hard work.
Article by Noelle Greenwood who believes children should not miss out on financial education which is important for making responsible decisions upon reaching adult life. Noelle helps manage a number of finance sites that help consumers choose financial products to meet there needs such as the best savings account interest rates to the credit card with the best rewards.