By Jeanne Ching
Rising prices and limited resources force most people to live on a budget. To do this, we need the support of the whole family. Therefore, early in life, we need to teach our children how to handle finances. The following are some important teaching points:
- Teach children how to prioritize expenses. When we give them money to spend, we should help our kids be aware that there is a limit to what they can spend. For example, their daily school allowance might include their meal, school supplies and a little extra. Therefore, they need to prioritize their expenses.
- Clarify the difference between needs and wants. Yes, we need to eat, we need to buy stuffs. Yet, we don’t need to eat in a five star restaurant daily or buy a branded bag just because friends have them.
- Be creative. Instead of buying ready-made stuff, try to make your own toys and mix homemade coolers. This will be a fun project for you to do with your child and furnish some bonding time as well.
- Teach comparison shopping. My nephew went shopping with me. He wanted to buy some things in a store where the prices were a lot more expensive. I asked him to check out the items and inquire about the price, then, I told him to hold the purchase. Next, we went to another store and bought the items where the prices are much cheaper. That day, he learned how to compare quality and prices.
- Learn to save. As children, we used to have kiddy savings accounts. We were also provided with piggy banks. It was quite satisfying to learn how much we have saved at the end of the week. What we had saved also served as an emergency fund when an unforeseen need arose. Or, sometimes we saved for something more fun like a new gadget.
- Live by example. Children learn from what we do rather than what we say. If we save and budget, they will too!
