Kids generally grow up without having to fend much for themselves. They get their necessities from their parents on a silver platter and their physical and emotional needs are hopefully taken care of by their parents. The most they might do is their chores around the house.
How then, can we expect our children to grow up to be financially educated adults?
How do we integrate the words earn, save, calculate, wait, and spend, into their life?
How can we teach our kids about finances?
The truth is that from a young age on, kids can watch a piggy bank fill up, be given money to hand over to a salesperson, or even be allowed to choose something in the candy store within their allowance.
Here are some tips on how you can teach your kids about finances.
Get a debit card for your kid
There is a huge market of debit cards meant just for kids. Those debit cards have features geared to teach kids about finances.
An example of a feature on a kids debit card is parental control. That gives the parents the capabilities of tracking where their child is using their debit card and also to see all the card transactions. The parents can also choose the amount of money to be transferred onto the child’s debit card and set specific spending limits.
On some cards, the child can have the card app which can include games and quizzes to sharpen their financial knowledge.
Getting a kids debit card for your child is a great way of teaching them hands-on finances.
Following are some of the many options for kids debit cards.
The Greenlight Debit Card can be used for kids of all ages. The card has a monthly fee of $4.99 for a family of 5 kids.
This card has so much you’d want in a kids debit card. The parents can send automatic transfers with the kid’s allowances. Parents can also set up a list of chores which earns the child an instant money transfer to their account.
The child can then go on to save the money and earn makeshift interest on savings that parents can set up.
This card is free but can only be gotten by kids who are Chase customers.
Children can set saving goals for different things they wish to have and watch as they save up money and move closer to their goals. Parents can set ATM withdrawal limits and also spending limits for specific purchase categories, which is great. Parents can also get notification alerts each time the child uses the card.
Unique features on this prepaid card include the ability for the child to transfer money to charity causes. The child can also invest money in real companies such as Stockpile.
Parents will have to approve every purchase the child wants to make with the BusyKid Visa.
Give your child allowances
Another great way of teaching your child to finance is through giving them allowances.
Once the kid has money in their pocket they will automatically have to start making financial decisions. Should they save the money for a big purchase, use the money for candy they are salivating for, or share the money with big bro.
Have them earn commission
More than allowance, have them earn their money. They should learn from early on that you have to work for your money.
Allowance is nice to show your kids you feel they can be trusted with pocket money. But commission for finishing specific chores or for completing a behavioral chart, can make a lasting impact on the value of money and that it takes effort to earn money.
Whatever tactic you choose to implement to teach your kids about financing, believe in them and their powers for becoming savvy little business people.