|Teaching your kids to budget, save and manage their money well from a young age will stand them in good stead throughout life. The key to get them interested in money matters is to make it exciting and fun for them to be thrifty with their money.
René Roux, head of Sanlam Liquid, gives some easy ways to get them to budget and save.
1. Get a big bright money box
2. Give them a goal to save for
For children, a money box (with a lock) is an effective savings tool as it is tangible and they are able to watch the money box getting fuller and fuller as they add to it. If you can find one that resembles your kids’ favourite cartoon hero even better, as it will hold their interest and add to the excitement. Suggest that they add a portion of their pocket money into the money box. You could incentivise them by saying that for every R5 they add, you will add R2.
It is generally easier to save money when you have a definite goal. If they have been eyeing out a new toy encourage them to save up for it. Realistically work out how much of their pocket money they need to save and for how long. Cut out a picture of the toy and stick it up above your child’s money box, so every time they add money into the box they are reminded that they are one step closer to being able to buy their toy.
3. Take them shopping
4. Get them their own bank (savings) card
Although it is sometimes easier doing the grocery shopping on your own, it can be beneficial for your kids to take them along when possible. Before you leave home, sit down and make a list with them of all the things that they need to buy. Some supermarkets have little shopping trolleys for kids, so browse around the store with them and let them choose the items and put their items in their trolley. At the till ring up their items separately and give them the cash to pay for their items. This might take a bit longer, and it’s often not ideal to do it every time, but it will instill good shopping habits from a young age.
When your children are old enough, it is recommended that you take them to open a bank account and give them their own bank card. Take your children to the bank to deposit their pocket money into this account and insist on a receipt so they can see the amount register in their account. When the money is in the account it is less accessible and harder to spend. Together with owning their own card comes responsibility, so make sure they understand the importance of looking after this bank card.
5. Give them the chance to earn extra money
When your children have spent all their pocket money, instead of giving them more money, give them the opportunity to do extra chores around the house. Once they realise their earning potential you might have a lot of willing hands wanting to do a lot more extra chores around the house. But don’t allow the extra chores to take preference over the compulsory household chores that they don’t get paid for. And help them to budget their spending more efficiently next time.
No matter what vital life lessons you need to teach your children, if you make it fun and interactive they will be more likely to remember it. And if you are enthusiastic with your teachings, you are more likely to have enthusiastic learners!
Sanlam Life Insurance Limited is a licensed Financial Services Provider.SPF’s underlying philosophy centres on offering needs-based solutions for clients, valuing diversity, being innovative and attracting superior talent. For more information, visit www.sanlam.co.za, view Sanlam’s online media centre here.