It’s never too early to teach children about finances, from saving to earning to handling. To help parents bring up financially savvy children, insurance company Axa Philippines offers the following tips:
Introduce the concept of money
Helping children understand and respect money from an early age will help them manage it well when they become adults. Start by letting the child see and handle coins and small bills so they become familiar with money as part of everyday life.
Start with a savings jar
A piggy bank is a good idea, but a clear jar is even better. With a clear jar, the children see their money growing. Saving loose change or 10 percent of their allowance can help develop the habit. Talk this through with them and stress the importance of saving money.
Let them earn
Summer jobs will help young people learn about business and hard work. The same goes for doing chores. If they get an allowance, call it a commission instead. Allow kids to earn commissions for different household chores.
Show them that things cost money
Do more than simply saying, “That toy car costs ₱300.” Let them get the money from their jars to bring to the store and let them be the ones to hand the cash to the cashier. This simple action will have more impact than a five-minute lecture on the value of money.
Set an example
Children learn by example; the best way to teach them about saving money is to set a healthy example for them that they will much more likely to follow when they get older. Show children how prices differ and explain how to make more intelligent choices. Reiterate the message that every time they get money, they should save part of it to prepare for the future.