Children these days are getting exposure to many things and compared to the previous generations, they are all fast and learning many things at a very young age. When we say that, it is also important for them to have financial knowledge. It is never too early or never too late to start this with our kid. Some parents have the mindset that they will spoil their kids if they provide access to money at a very young age. This is not a correct ideology in my opinion. Parents can guide them and teach them the right things so that they are very responsible with the money.
Financial independence is something that is not only important for old people but it is good to achieve financial independence at a very young age when we still have the strength and mind to achieve great things. I used to think this way. Imagine if the great Mathematician Srinivasa Ramanujam had financial independence and had no need to struggle to stay abroad. We would have received a lot more gems from his brain. There are still many unsolved puzzles in his notes.
Start with a piggy bank
If we are giving financial education to the kids, I would start with a piggy bank. The idea of a piggy bank is to not keep the funds just to themselves or to not share them with anyone. The basic idea of a piggy bank is to create a mentality of saving from a very young age. The kids should be brought up with that mindset and they should also be taught to use the funds they saved on the right things at the right time. Parents should be very transparent with their kids and that helps them not spend the money they saved on the wrong things. Parents can oversee where the funds are being spent.
Maybe parents can keep giving some small funds to the kid to keep them safe and when there is a celebration or if the kid gets a good mark, they should be taught to use those funds to give a good treat to the family. Of course, parents can give such treats but if the kids do it, they get happy and we are not only teaching the savings habit but also the right spending habit.
Teaching the kids about financial literacy
Financial education is a long process and it has to happen as the kid is growing up. Right things are brought to them by parents. If the parents are teaching them financial knowledge in the right way, even if there are friends who take them in the wrong direction, they cannot go in the wrong path because of the knowledge given by the parents at a very young age. So starting financial literacy at a very young age is very good.
Handling finances and creating wealth
Gradually when the kids grow up, we can allow them to handle finances and show them how to create wealth. It is not a burden on them and it is not like they will lose interest in their studies and start focusing on creating wealth. If this happens with the guidance of the parents, the children will find it comfortable and they get the proper learning. It will also gradually make them grow with a responsible mindset towards money which is very important. Kids should be good at handling finances. They should not be stingy and at the same time, they should also be very careful with their spending. This becomes a good learning if parents travel along with them teaching things through the process.
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