Most kids have a money box or piggy bank, some parents even teach their kids to save for goals like holiday spending money or Christmas. This, along with pocket money are perhaps the earliest finance lessons we all learn. Guest writer and psychologist Nick Petrovic offers some tips on motivating kids to learn valuable lessons for their future.
As every parent knows, when it comes to our children, we want them to have everything we did and more. Positive financial lessons for kids is one way we try to do this. However, while our wisdom and intentions may seem obvious, children are often reluctant to take advice on board. How can you keep your child motivated to save, particularly when they reach an age where spending is not only enjoyable, but socially expected? And how do we convince them that it was their idea rather than another lecture?
Children are a product of their upbringing. When it comes to financial lessons for kids, a parent is better off teaching discipline and basic principles from a young age. When children have a background understanding of how money can be used to better their situation, they are more likely to take these lessons into adulthood. Having said this, it is still possible to encourage positive financial behaviour in older children. The key is to find a way of making the process meaningful to them and, above all, showing them that saving money will ultimately assist in their independence – something most teenagers yearn for.
Make it about them
Many parents want nothing more than to spare their children the struggles they have gone through. However, as many know, the moment you make a lesson about you, your child is likely to go into lecture mode and dismiss your advice. Instead, try to make it about them. Find out how they would like to make money work for them. The most important thing is to make it meaningful to them, get them excited about saving and avoid raining on their parade if their aspirations are a little ‘out there’. It can also help to make their goals tangible, rather than simply saving for a rainy day. This can include making and prioritising a list of potential purchases they would like to make like a car for example.
To show your children you are serious about helping them in their financial journeys, invest yourself in them. One way of doing this is to match their savings – if not 100 per cent, then 50 or 25 per cent. Either way, this keeps them motivated and shows that you are invested in the process. Give them your time and be there to answer any questions they may have. Share ideas and experiences, but avoid imposing them. It’s also important to value their input. Remember, what drives you may not drive them – get to know their hopes and passions and aim to empower them. Don’t forget, however, that mistakes are also important in learning, so don’t feel you need to protect them from every financial error (such as debt) they make.
Make results count
Saving money is a lot like exercising in that the results can take some time to appear. For kids, and particularly teenagers, it’s this waiting that can lead to a lack of motivation to continue. Spending money therefore becomes an important factor in saving money. Spending will allow your child to enjoy the fruits of their labour and show that the process actually works. If it’s all sacrifice and no reward, they can lose their drive to keep going. As the rewards continue, you may even find your child is happy to wait, excited about what bigger and better ones they can reach for.