5 Money Hacks for your Children (or Grandchildren)
Did you know that Isaac Newton introduced the ridges on coins?
This is just one of the many interesting facts included in Deborah Meadenâs Little Experts book âWhy Money Mattersâ.
The Dragonsâ Den investor and entrepreneur has taken pen to paper to create a childrenâs guide to money.
This has inspired us to come up with our own tips that we thought weâd share with you.
Financial literacy is important, and the earlier itâs introduced to children the better.
So, if youâre at a loose end this summer, why not go through the money hacks below with your children or grandchildren and give them a head start when it comes to the next school year?
The schools sure as hell aren’t going to teach them about money (yet it plays such an important role in life!).
Why saving matters
One of the most important lessons we can teach children is the value of saving.
In a world of instant gratification, it can be tempting for young people to spend their money as soon as they get it.
However, by instilling in them the importance of saving, weâre setting them up for a lifetime of financial security and stability.
Saving money is not just about putting it aside for a rainy day, it’s about understanding the power of delayed gratification.
It’s about teaching children that the things they want may not be instantly attainable, but with patience and discipline, they can achieve their goals.
Whether it’s saving up for a new toy, a car, or even their university education, we can show them that by setting aside a little bit at a time, they can reach their dreams.
Furthermore, saving money teaches our children the value of hard work.
It shows them that the things they desire in life require effort and sacrifice. They learn that money doesn’t come easily and that it must be earned through dedication and perseverance.
The value in starting early
Encouraging your child to save at least half of their pocket money or earnings is a good place to start.
They can begin with small amounts that gradually increase over time.
Show them the power of compound interest, and how even small amounts saved regularly can grow significantly.
Make saving fun by creating savings goals that your child can relate to, such as a day out with friends.
Teach them how to track their savings and celebrate milestones along the way.
When your grandchild sees the results of their savings, they’ll be inspired to continue saving for larger goals.
Talk about debt
Debt often has a negative connotation (and in most instances correctly so), but it’s not inherently bad.
It’s important for children to understand the different types of debt and how to use them responsibly.
For example, borrowing money to purchase a home or invest in higher education can be considered a good debt if it’s managed well.
However, credit card debt or high-interest loans, all crappy debt can quickly spiral out of control and harm your financial wellbeing.
Teaching children about good debt and bad debt can help them make informed financial decisions in the future.
It’s also important to teach children about credit scores and how they can impact future borrowing opportunities.
By instilling these lessons early on, children can avoid the pitfalls of bad debt and make responsible financial decisions as they grow older.
How to manage money online
In the digital age of today, managing money online is an essential skill for everyone.
Online banking, budgeting apps, and digital wallets are just a few of the tools available to help kids manage their finances responsibly.
It’s crucial to educate children about the risks and benefits of managing money online and how to keep their information safe.
Start by setting up a secure online account for your grandchild and show them how to navigate the interface.
Encourage them to monitor their account regularly and keep track of their spending.
Using budgeting apps can also be helpful in teaching children how to manage money online.
These apps allow kids to set financial goals and track their spending while giving them a better understanding of their financial habits and patterns.
The concept of investing
Investing is one of the simplest yet underutilized wealth creation hacks.
I repeat, investing is one of the simplest money hacks to create wealth.
Introducing your grandchildren to the concept of investing is a game-changer in their financial journey.
Investing sensibly is not just about making money; it’s about making money work for you.
By teaching your children the ins and outs of investing, you are empowering them to become savvy decision makers and risk takers.
Theyâll learn how to make informed investment choices that align with their financial goals.
But investing goes beyond the realm of finance; it fosters critical thinking, patience, and discipline.
It teaches them to embrace uncertainty and seize opportunities.
So, open their eyes to the world of investing.
Show them that it’s not just for the wealthy.
With knowledge, guidance, and a sprinkle of enthusiasm, you can ignite a passion for investing that will shape their financial future.
Summary
In conclusion, 5 simple to teach money hacks.
As parents and grandparents, you have the incredible opportunity (and duty) to empower the kids with the knowledge and skills they need to navigate the complex world of money.
It plays such an important role in life yet isn’t on the school curriculum.
By teaching them the value of saving and encouraging wise spending habits, we can set them on a path towards financial security, independence and wellbeing.
Get in touch
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Email us at info@fortitudefp.ie or click below to schedule an introductory call at our expense.
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Our blog posts are intended for information purposes only and should not be interpreted as financial advice.
You should always engage the services of a fully qualified financial planner before entering any financial contract.
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