If there is one guarantee for parents, it is that there will be many instances when you need to have awkward conversations with your children. From the ‘birds and the bees’ talk to money matters, it is not always going to be fun.
Teaching kids about the value of money early on kick starts their financial literacy skills and prepares them for the future.
Having these important conversations may help shape their way of thinking and how they view and interact with money when they grow older.
Here are the top eight tips to help you get the conversation started:
- It’s critical to start early: while children can still be taught to make good decisions as they transition to adulthood and become more capable of managing their own finances. By starting to train them at a young age, you can guide and set them on the right path. An easy avenue for doing this is through Absa’s MegaU App that is free, interactive, and developed to make banking simple, rewarding and most of all fun and educational for children. As parent, you can assign certain tasks to your kid, this way they can earn their pocket money and you can use the App to transfer their pocket money into their account, while they can view their balances and transactions. To enjoy the benefits of the Absa MegaU App, you must have one of our transactional accounts and your child must have a MegaU To open a MegaU account for your child, visit your nearest branch, call 0860 100 372 or visit absa.co.za*.
- When giving pocket money to your children, make sure you discuss what the money is going to be used for or what goal it is going towards. This way you teach them the value of saving for both short and long-term goals.
- When your kids ask for money, especially if it is over and above their weekly or monthly allowance or pocket money, discuss the reasons why they are asking for it and decide if it is necessary or if it can wait for a birthday or a special occasion.
- Don’t only talk to them about money when they ask for it. Take the opportunity to discuss money and personal finances with your children on a continuous basis: for example, chat to them about their allowance and how they can make the most of it e.g. by saving a percentage for specific goals.
- Assist them with opening their own bank account – such as Absa’s MegaU account, which is designed with young people in mind – and discuss how savings can help them reach their goals.
- One mistake you should actually allow your child to make is spending all their money on one transaction and buying the first thing they see. They’ll quickly learn to ‘ration’ their money or save it for what they really want rather than to buy impulsively. This will be a valuable lesson to reinforce throughout their lives.
- Perhaps the most important lesson of all, though, is that children look up to their parents, so it is important for you to “practice what you preach”. If you refrain from impulse buying, your children will mirror your behaviour – especially when they are being pressured by their peers to “keep up with the Joneses”.
