Financial Education For Children

Restored from the Empower Network archive (2011–2017), lightly edited to meet our current advertising standards. Views are the original author’s.

Financial Education For Children Begins At Home

When I was a kid I remember getting an allowance every week in exchange for set chores I had to complete during that week. It taught me the value of earning, however I also remember that I was allowed to spend my money on whatever I wanted, and I did. My sister would save her money for other things, like a special pair of shoes, I usually bought lollies and the like. Apart from my parents saying I should save money, that was the extent of my financial education growing up.

Children learn more from what you are, than what you teach, lead by example with financial education.

Today I hold to those things I was taught back then in regards to paying my children for the chores they complete during the week but with a slight difference. They have three jars, one is for savings, one is for investment and one is to do whatever they want with. Each time they get paid they must put 10% into savings, 10% into investment and the remaining 80% is theirs to do what they want with.  At first financial education was not received very well, they did not see the merit in it at all, but over time as the savings and investment accounts grew they became excited.  We explained to them that the savings account was for big things that would help them grow and learn and move forward in their lives.

For Example: Jesse takes guitar lessons and uses an acoustic guitar but he really wanted an electric guitar and amp and had researched and found the perfect one. We told him that if he saved half of what it cost we would put in the other half for him as part of his birthday present, his birthday was five months away. He worked out that 10% of his pocket money was not going to be enough so, at our encouragement, he drummed up a few lawn mowing and car cleaning jobs around the neighbourhood to get the extra money together. He also decided he did not have to spend his weekly 80% on the usual lollies and soda and cut that down dramatically. By the time his birthday arrived he had saved enough to pay for his guitar and amp himself and we bought him a really good case to house it, he had also built up a small business that he was more than happy to keep going because he could now see the value of saving. His friend Lachy joined him in the business and they now share the profits as well as the expenses and they both set goals for what they want and each time it is achieved they set another goal.
Jesse knows that this money is working capital and will always be re-invested into something that will make more money, it is not for spending, his financial education has a strong foundation.
Eventually we will show him what his investment money really does. His working capital will eventually be enough for him to be able to invest in something that will yield bigger returns, i.e. land or property.
I think it is important to note that my partner and I did not become money wise until just a few years ago and that it took us a good couple of years to sort out our own finances so that we now actually have an investment portfolio and very little debt. Before, we were in debt heavily and lived from pay check to pay check and had no savings or even knew what an investment portfolio was. We had always wanted to travel but knew that would be impossible if we did not get our money affairs in order. Learning about money is the best move we have ever done, not only for ourselves but for the financial education for our children and their children. We can now teach them to use money and love people, not love money and use people which is what 80% of us do 100% of the time.
Money is a tool to be accumulated and spent for the sole purpose of making your life and the lives of those you love and admire around you rich and rewarding. It is not a sin to be rich, in fact, it is a sin not to be rich.

“Your playing small does not serve the world, who are you not to be great?” Nelson Mandela

 

Financial Education For Children – Leading By Example

How can you become the best you can be and give the best of yourself to everyone around you if you are constantly worrying about how to live a decent life? In order to live a full and happy life you must be full and happy and to do that you must have enough money to buy the food you want, the clothes you are comfortable in, the home you are happy in, the car you like to drive, the books you like to read, go on the trips and vacations you want to go on and have all the other things that make you a complete person.

The difference between those who have and those who have not is very simply, financial education. When you know how money really works and how to put it to work for you then life becomes much more.
Our schools do not have financial education for children, not in the extent it needs to be, so it is up to us to lead by example. Actions speak louder than words. By becoming masters of our own universes we are empowering our children to have control of their own lives without having to rely on ANYONE or ANYTHING.
It is a skill to be learned though, how much you will have to change will depend entirely on how you live your life now and the habits you have formed. The older you are the more deeply ingrained those habits may be but it is not impossible. If you have the desire to live a rich and rewarding life and are willing to do what it takes to get there, no matter what, then you will but you must have a place to start.
The Richest Man in Babylon by George S Clason and Think and Grow Rich by Napoleon Hill will help get you going. If you think you need a different approach to getting yourself onto the right road, go here, and if you would like to make money while learning how to become financially secure then go here.
Our children are our future and if we want their future to look better than ours then we must start by looking in the mirror….financial education for children must start at home and as early in life as possible.