Teaching your kids about finance is one of the most important things you can do for your child. The earlier you teach your kids about finance, the more prepared they will be when it comes to dealing with their personal finances as adults. Many parents never to speak to their children about money. They would prefer not to get them involved or want them to worry. Parents might feel that finance is an adult matter and don’t think it’s necessary for kids to know about it. However, finance can be made understandably for children too by using various money games for kids.
So, what happens when you don’t teach your kids about managing their finances from an early age? By the time they are adults, they will have no idea how to manage their money and might get themselves into financial trouble.
Teaching your kids about money doesn’t have to be boring. It can be a lot of fun and a way for you to bond with your child too. Therefore, we’ve put together a list of the top 5 money games for kids so you can teach them about finance. In addition, we’ve created a list of 5 tips for teaching kids about money.
There are plenty of money games for kids you can use to teach your children about the value of money. Fun money games are great way to teach kids about finance, especially when your kids are young. You can even play money games with kids as young as toddlers.
When kids get involved with real life situations, it is like practice for them. When the time comes for them to do things themselves they will have a lot more confidence in handling certain situations.
The key word in that sentence is “earn”. Teaching kids that they need to earn their allowances will help them to appreciate the value of money. Teach your kids they must do their chores first before they receive their money. There are some things that the allowance shouldn’t cover such as cleaning their room or washing the dishes. These should be things they are expected to do, and it’s important that they understand that contributing is a part of being in a family.
The allowance should reward them for doing other chores such as folding the clothes, mowing the lawn, vacuuming, dusting, cleaning the windows, or any other household duties. You can then pay them after they have done their chores, this will fill them with a great sense of pride. If they haven’t done their chores then they won’t get paid. This will ensure that they feel proud of the money they’ve earnt and are less likely to spend it frivolously. This is an invaluable lesson to teach your children that they will carry with them throughout their lives.
This can be done hand in hand with giving them an allowance. Teach them that a portion of their money should be saved. This will teach them that they need to save up for items that they want. It will also help them to develop a savings habit.
One way you can do this is to give them 3 money jars, one labelled save, one labelled share and one labelled spend. Get them to put 10-20% of their allowance into the save jar. Then help them to divide the rest between the other 2 jars, depending on what they are working towards.
The jar idea is great because it gives them a visual to work with. Getting them to use a bank account is something you can start introducing to them at around 10 – 12 years old. Once they have a bank account you can pay their allowances here and teach them to transfer 10-20% into their savings account.
One important concept not to overlook when teaching kids about money is the importance of investing. In fact, it’s never too early to teach your kids about investing, because the earlier the better. To gain the most out of investments, you must do it overtime, because the longer you have been investing the bigger your gains will be.
If you’ve been teaching your kids how to save, teaching them about investing is a similar concept. Teach them the difference that investing makes in helping you to build up a return on the money that you put away. One way to teach them about investing is to use money games for kids (e.g. computer games). They are meant to introduce kids to investing and making it fun and easy for them to understand. One great money game is called “The Stock Market Game”. It is one of those interactive money games that specifically teaches kids about investing.
This is not something that you need to teach toddlers, but a good time to start introducing kids to the concept of credit is around the time they start using a bank account. The reason why it’s so important to teach your kids about credit, is to ensure that they don’t get themselves in trouble with credit as adults.
Teaching kids about credit can be done by lending them money to buy something they want, then they repay it to you at a pre-determined interest rate, with their allowance. In addition, here is a list of some money games for kids you might like to use to teach your kids about the concept of credit:
Money games for kids that teach them about using credit responsibility will help to convey these important lessons that children should understand as early as possible:
In summary, teaching kids about money is important, and it’s never too early to start. On the other hand, it’s never too late either. Even if your kids are teenagers, it’s better to introduce money concepts to them before they enter the real world. Better late than never, right? Money is incredibly important, and will have a massive impact on their lives. Thus, the earlier your kids understand the concept of money, the more prepared they will be to handle their finances in the future. To conclude, here are the key take away points from this blog: