It’s a fact that we need money to normally function in our daily lives. According to West Ridge Academy, you cannot just disregard it as if you don’t need it in your life because the truth is that all of us need it to function normally within our daily lives. The truth is money can either be your friend or your enemy depending upon how you treat it; and whether you take good care of it or if you spend it like there’s no tomorrow as soon as you lay your hands on it.
If you know where to invest it, money can definitely work for you or even grow by itself without you even lifting a finger Conversely, if you are not knowledgeable enough regarding the intricacies of money then there’s a real possibility that you can run into financial trouble in a blink of an eye.
If you love your children, you must teach them about financial literacy as soon as possible so that they won’t find themselves in financial trouble when they become adults. West Ridge Academy suggests a couple of activities below which will help you educate your child about financial literacy as early as possible.
Give a weekly allowance to your child and make him accountable for it. By giving your child a weekly allowance, you are subtly teaching him how to budget. Figure out an amount that is just enough to cover his basic needs for one week and give it to him as his weekly allowance. Make it clear to him that you won’t be giving him any additional money if he runs short of funds, hence he should make his allowance last for the whole week as originally intended. Whatever money he can save will be his to keep and he can use it for whatever purpose that he would like.
Encourage him to slowly save some money weekly from his allowance in order to buy his favorite toy or bike once he can save enough. In doing so, he will be able to learn many things about the nature of money, such as: the cost-effectiveness of choosing lower-cost foods (although not necessarily lower in nutritional value), in order to save some of his allowance; or the difficulty of accumulating money since you have to sacrfice a lot just to save a little amount; or he may learn to appreciate the true value of his toys since he will now have a better idea how hard his parents actually worked so that he can get his favorite toys.
Spend some time to play educational board games with your child which teaches some basic financial ideas. Games such as Monopoly, Life, or other games that have financial relevance, can be fun and at the same time very educational ways of teaching your child about some of the financial basics. He will definitely ask you a lot of questions during the game, so you better be ready with your answers becuase this is your opportunity to explain the general financial concepts to him in an educational but fun learning environment. You may want to use simple real-life examples that he can relate to, in order to teach the concepts to him. According to West Ridge Academy , by the end of the game you will not only walk away from the game with a much more financially-savvy child, but more importantly, you will have a much stronger bond between parent and child.