Parents have to answer any question that a child asks in a simple way and taking into account their age. Although there are terms that are very complex for children, it is important that from an early age they learn to value money and know how the economy can affect the family.
According to the data presented by the Pisa 2015 report, 1 in 4 Spanish 15-year-old adolescents (exactly 24.7%) does not reach the minimum level of competence in this matter. These data mean that students are able to understand the purpose of a financial document such as an invoice, but not explain the main financial products, know how to differentiate between what is needed and what is wanted, or make reasoned decisions in daily spending.
For adolescents to acquire these basic financial competencies, it is important that they learn to understand family expenses from their childhood. They need to know that the family has a budget that determines how much can and cannot be spent.
Tips for educating about the value of money
Although it seems complicated, it is not so difficult for our children to understand basic economic terms such as saving, spending or budgeting. They will surely understand if we apply it to our daily lives. We are going to give you several practical tips to educate our children about the importance of the economy and money.
For our children the concept of money is often complicated. They do not understand where it comes from or the reason why some expenses can be made and others not. We have to explain to them that parents obtain money through their work and with it they buy what is necessary for the whole family. In this way they will understand the value of their parents' work.
For children to know the value of money they must be able to handle it directly. They must know the value of each of the bills and coins they own. A good idea is to assign them a weekly or monthly payment for their expenses. They also have to know what they can spend their pay on: whims, gifts, magazines, books ... They have to learn to pay directly in stores and calculate how much they pay and how much they have to return. We can also give them two piggy banks, one to spend and one to save. Try to save them for something that they are very excited about: a book, a toy or a T-shirt. If they have a long-term goal, they will start saving.
Children can only rate a product if they are aware of the effort it takes to get it. We have to explain to them how much we have to work to pay the mortgage, the car or the summer holidays at the beach. This way they will understand that earning money is an effort and they will learn to value what they have.
Another good idea is to reward them when they do extra tasks like helping take the trash down the street or cleaning the car. Always with a small and reasonable amount of money that they can add to their pay for their small expenses. Of course, children should never be rewarded with the tasks assigned to them in family life such as throwing dirty clothes into the basket or cleaning their room for example. Each one has his role in the family gear and his tasks adapted according to age.
It is important that parents always be a good example when it comes to limiting expenses and saving to maintain the family finances. Children have to understand the reasons why the family cannot yet change cars or why when we go shopping we opt for white or cheaper brands. Little by little we will get children to become interested in the value of money, saving and making good decisions for the family economy tuition.
