People who are financially responsible do not get that way overnight. It’s a discipline that is learned through time. Learning how to manage money can start early on with euros and cents. Your child does not need to have huge amounts of money to manage. It’s all about what he does with the money he gets more than the amount of money he has.
Money is considered a resource to allow you to buy products or avail of services. You work to earn money. Unfortunately, you do not necessarily earn more money when you work harder. Children are limited by the money that their parents give them. You therefore have to be wise about the how you spend your money. You want your money to go a long way. You also have to save money for future expenses. This is where sound money management comes in. You want to be able to successfully save money and still address your money needs. For your child, this would perhaps include their lunch money and maybe some treats.
Saving is an important lesson you have to teach your kids. Do not wait to start saving when you have more money. The sooner you start saving, the more money you would have in the future. Saving 50 euro cents a day will already give you about 185 euros in a year; that’s a whole lot better than not having anything at all if you wait an entire year for your allowance to increase. What your kids need to learn is how to save first and then allocate what’s left of their money for their spending needs.
Wise spending comes after saving. They should be able to budget what’s left after they set aside the money for their savings. This means keeping track of what they spend their money on. It is important for them to understand that they cannot always get what they want. Even if they have enough money for it, they should think about whether or not it is wise to spend their money on something that they want rather than need.
Another thing that you can teach your kid is that money is not simply a means to buy things. Earning and spending are not the only things you can do with your money. They can also make their money grow. There are savings accounts and investment products that they can put their money in so that they will grow at a much faster rate. When they have enough money saved up, you can introduce your children to wise and safe investing so that they can grow their euros and cents into bigger fortunes.