Budgeting For Kids: How To Teach It And Why It Matters
Budgeting for kids: Considering that most of the people reading this post are parents or guardians of a child – we have tailored this post to suit them.
Ok, now let’s start the article…
Never forget that what your child will be facing in the future is the “real world with more financial problems”. So to prepare them for social life, clearly teach your children how to “budget and spend frugally” from the time they reach a certain age.
Now let’s have a clear strategy on how you can easily teach your kids about budgeting.
Why is it important for students to learn about budgeting?
Your children will be under your control only for a certain number of years. Then when life is established for them, it is like they think and act on their own life. Then there may be a situation where you are no longer with them – then who will help them fix their problems financially?
Do you understand now? Why should you teach your children to budget money and spend it frugally?
Basic financial literacy is a need, want, or must-have for any child.
What are the benefits of budgeting for students?
This will give them huge benefits in the future. However, judging by their age, their basic needs will be met.
For example, they can budget their money to buy something like a bicycle, a cell phone, or a laptop and save the remaining amount to buy the above items.
How do you teach kids to budget money?
Don’t just impose the financial strategies we’ve outlined here on your kids overnight! Help them learn over time.
Strategy 1 – Start talking to kids about money a little bit.
For this, you have to create the right approach.
If possible give your child a list to make when going grocery shopping – under your supervision.
Through this, your children will know the current price of grocery items. And the account, the budget, and the expenses involved in running the family will become clear through your activities over time.
Strategy 2 – Get your kids hands-on lessons that teach them the value of money.
Try to clearly explain to your children how hard it is for every person in society to earn even $1 a day.
And if they don’t heed word of mouth properly – give them hard work and pay less for it. Value for money is easy for them to understand (this is the second stage idea – stick to the first stage idea as long as possible).
Strategy 3 – Is an item necessary/desirable? (can be avoided) or required? Teach them to think (cannot be avoided).
Read this post “Investing for Teens: 7 Ways To Get Your Teen Started” to know clearly about it.
A few lines to summarize though:
It is possible to live without the object of desire! But living without an essential item is a difficult life transition for anyone.
There is much more important information that we have to say here based on this strategy, but since it has already been published as a post, it would be better if you read it.
Strategy 4 – Be helpful and clearly explain to your children how to budget for an item.
First, find out what your child wants. Then take the step to know its price!
If the child’s favorite item is a laptop (MacBook Pro) and costs USD 2,499…
You have to teach your children how to budget for it. And you can even use budget worksheets for this.
How to make a budget: Lesson for kids
You should teach your children how to properly spend, save, buy, and invest the money they earn.
What are the most important things to teach your children?
Savings – Advice to save 40% of cash on hand.
Spending – Allow 30% of cash on hand to spend.
Investment – Allow 1% of your cash on hand to invest in the stock market or a new business.
Barter – We don’t mean barter here! We refer to charity. Donate money and teach your children kindness and virtue. Its percentage is 20% of 100%.
At what age should parents start talking to kids about money?
Here there are no restrictions for you and there is no structure for the child to have this age limit.
About 2 months after you start talking to your child about money, you can teach them to budget money.
Why is it important to teach children the value of money?
Yes! In this era, we can spend the money that we have saved for a long time even in a single day!
But can we earn such a huge amount in one day?
So teach your children to be reasonable even in spending – understand that this is also your duty as a parent.
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Sathish is a full-time blogger and freelance writer with a passion for side hustling, passive income, and the gig economy. True Home Occupations is all about providing people with honest ways to make and save more money by using technology. To learn more about Sathish, read his About Page!
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