Think back to when you were first learning about money. How old were you? Were you confused a lot? Did you need someone to explain things to you? Teaching the next generation about money now instead of waiting until they are older could benefit them greatly in the future.
Make sure you keep the money lessons simple. If you get too complex with them you may lose their attention and then they will not learn anything. The point is for them to learn so start really simple and as they get better at the concepts and as they get older add more to it and increase the complexity of what you are teaching them about money.
A great place to start when you are talking to your children about money is savings. It is important to save money, which will never change. From the time they start getting an allowance all the way through their retirement they will be in need of saving money. This is why you should get to them early and talk to them. Find fun ways to make them want to save their money.
Have them set a real goal. For example if there is a toy or gadget that they really want, make them set that as a goal so they will have to work for it. This will teach them about the importance of money and how far a dollar does or does not go. It will help them prepare for their future when they will have to save up to make many of the purchases they want.
When they get old enough get them a checking account. It might be a good idea to put your name on the account as well to make sure that everything stays okay. This will help them to learn how to manage their money. It will help them to learn how to balance their checkbook and figure out if they truly can afford something.
As they get even older start talking to them about stocks. Show them your portfolio and go over how you manage it. Help them start one of their own. They should start small though, when they are first starting out they should not try to do anything too big, after all they probably won’t have a ton of money to begin with anyway.
Teaching the next generation about money is important. If they do not learn how to manage money, what are they going to do when they get older? They will end up in a lot of financial trouble? No one wants this for the next generation; we want them to succeed financially. This is why we must take an active approach to making sure that they know how to manage money.
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