Money Lessons for Children at MoneyTree AsiaPac - Developing Tomorrow’s Financial Geniuses

Published in The Finder
June 2009

By Shikha Gaur

Have you ever found yourself at Toys ‘R’ Us or the supermarket, with your child insisting on the purchase of toys or lollies? Recently, I was at the supermarket when my son decided he wanted two packets of sugary lollies – chocolate and candy. I said he couldn’t have both. My son didn’t take no for an answer and threw a massive tantrum.

For parents, it’s a constant challenge between giving your child everything and ensuring they understand money doesn’t grow on trees – or come out of “the box in the wall”. By encouraging good money habits at a young age, your child will soon learn the importance of saving and managing money sensibly as they grow up. To instill good money habits, try the following tips:

Start early. Your child picks up on things quickly and their curiosity presents many opportunities – start talking to your child about money at an early age.
Set an example. Get your finances in order – your habits and views will impact your child’s money values.
Make it visible. A piggy bank or jar filled with money sends the message “savings are important” and most importantly, allows your child the opportunity to see the amount grow week by week.
Give an allowance. Pay your child for household chores completed, but allow them to budget and learn about living within their means.
Encourage choice. If your child chooses to buy one piece of candy now, they can save the rest to buy a toy another day. If they choose to buy two pieces of candy now, they won’t have any savings for that toy. Rather than do’s and don’ts – teach your child about the consequences of choice. Let them choose how much to spend and save.
Don’t spoil. Don’t give your child too much – they’ll only grow into an unsatisfied adult. What will your child aspire to, if they think they can have it all?
Family finances. Get your child involved in the family finances in a positive way – and remember, never fight about money in front of the kids.
Understand the value of money. Encourage your child to start working at an early age. Once they experience the effort required to earn dollars and cents, they’ll soon value its worth.

This article is contributed by Shikha Gaur, Senior Vice President and a Licensed Financial Adviser Representative with ipac financial planning Singapore private limited, which is licensed with the MAS, Financial Adviser’s Licence No FA100003-3.

For more information, please email financial.planning@ipac.com.sg

In preparing this information, we did not take into account the investment objectives, financial situation or particular needs of any person. Before making an investment decision, you should speak to a financial adviser to consider whether this information is appropriate to your needs, objectives and circumstances.