Top Tips for Raising Money-Smart Kids

From politeness and table manners to ABCs and 123s, children are learning new things all the time - but often miss one crucial lesson: money management. This critical skill is often overlooked, but with our top five tips, your kids will be money-smart in no time!

Tip No. 1: Open A Savings Account

This is a great place to start when teaching your child how to manage money. Stowing pennies in piggy banks is a thing of the past as many banks offer savings accounts especially for children. Not only is this option safe, but it also allows saved money to earn interest and grow - and it will make splurge or unplanned spending a little less likely!

Tip No. 2: Earn Pocket Money

After setting up a suitable bank account for your child, encourage them to fill it! While many parents provide their children with weekly pocket money, this eliminates the opportunity to teach your child the value of money by having them earn it. Instead, it may be worthwhile to have them complete chores around the house for monetary compensation. If your child is old enough, encourage them to get a part-time job. The key here is to teach your child that money is obtained by working for it, instead of simply just giving it to them.

Tip No. 3: Getting Involved with Family Shopping

A great way to teach your kids about the value of money is through grocery shopping. This is a major expense in any household and provides your child with an idea of the cost of living. A quick trip to Tesco can help your child learn about shopping deals, the benefits of buying in bulk, and about coupons. Who doesn’t love coupons?

Tip No. 4: Thrift Shopping is the Best Kind

“One man’s trash is another man’s treasure” - and these treasures are found in thrift stores! At these second-hand shops, your child can find almost anything for a fraction of the price, including toys, clothing and hobby items. Purchasing pre-loved goods can teach your kids about how to cut costs and save money, allowing them to spend their earned cash in an easy, cost-effective manner.

Tip No. 5: Lead By Example

The best way to raise money-smart kids, by far, is to be a money-smart parent! By being the advocate for the lesson you are trying to teach your child, they can learn by watching you implement the same tips and tricks you’re passing on to them. Here are some ways you can lead by example:

• - If you don’t have one, draw up a budget and take your child through it. This teaches them how to divide their money up and to prepare for the costs their adult life will undoubtedly bring them.
• - Save regularly - for rainy days and sunny days, too! The importance of saving money cannot be understated, and can even help your child avoid going into debt in the future.
• - Don’t overspend. This is one way to drain your bank account quickly and will undermine the savings lesson you’re trying to teach your children.
• - Spend wisely. Thrift stores and coupons aside, being money-smart also means making wise spending decisions.
• - Set goals. Whether it’s their first car or a trip away with friends, putting money aside for a specified goal can motivate your child to avoid brash, spontaneous purchases and encourages them to spend their hard-earned money on something worthwhile.