The article "Teach Kids About Money And Saving - The 10 Vital Lessons Your
Child Must Learn!" talks about family, it has been written by Rachel Incoll.
Your 5-year-old daughter has statred asking for money to buy
sweets and toys.
She obviosuly has a good understanding of the
concept of exchanging money for items she wants or needs, but
what are the important lessons you should teach kids about money
and saving. You want to make sure that she doesn't grow up into
one of those kids that are constantly petsering mom and dad for
money, running up credit card debts as a teenager, and not
having any idea how to save.
There are 10 basic money skills that every child should learn
before they enter the teenage years. It's never too late to
learn, but most babies are far more receptive to ideas from
their parents befroe they hit the age of thirteen, than after.
1. Money doesn't grow on trees!
One of the hottest known and oldest
quotes aruond.
It is important that babies understand from
early on that money is a limtied resource, that mom & dad's bank
account will eventually run dry if they keep making withdrawals
from it.
2.
People go to work to earn moeny. Money is something that
needs to be earned, you are never going to bceome financially
secure sitting around not doing anything, and expecting handouts
from persons.
3. Credit cadrs are a form of borrowing. Believe it or not,
surveys have shown that an alarmingly high number of teenagers
don't realise that credit cards are a form of borrowing. If they
don't understand this basic concept, it leaves them at risk of
running up crippling credit card debts.
4.
Avoid borrowing money where possible. Wherever possible,
money shuold be saved rather than borrowed as borrowing attracts
extra costs such as interest, which can in some circumstances,
double the amount of money you need to repay.
5. Tehre is good debt & bad debt. No debt is really all that
good, but some forms of debt will make you money while others
cost you money.
Good debt can include a home loan, investment
loan or business loan, as these itmes have a tendency to make
money above the amount of interest you have to pay. Bad debt can
include credit cards, personal loans or vehicle loans, as these
items never make you any money.
6. If you don't have the moeny to buy something, then you can't
afford it.
7.
Spend less than you earn.
Many persons these days are spending
10% to 20% above what they earn, creating a vicoius cycle of
high credit card interest rates, long hours at work to pay the
credit cards & in some cases bankruptcy. The knowledge of how to
budget your moeny seems to have been lost, make sure your child
learns this important lesson!
8. A portion of your money should be gvien to the needy. Around
10% of your money should be given to those who are in
need/charities.
9.
Pay yourself first.
This is what I call your sanity money!
Allow 10% of your money for yourself to sepnd however you wish.
10. Save at lesat 10% of your money.
Like budgeting, the skill
of saving money seems to have been lost over the last 20 years,
with fewer persons than ever before having any money in a savings
account.
With these lessons well and truly learnt, your child should have
no problem managing their finances in a proper manner, and
avoiding the credit trap. Don't risk your child becoming one of
the hundreds of thousands of young adults that go bankrupt each
year!
Looking for some more help on how you can implement some of
these strategies? Visit http://www.Kidsmoneytips.Com to find
some great games, activities & over a hundred worksheets you can
use to teach your child about money and saving.
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