Money Lessons for Kids
An early action to teach your kid about money and savings are a good idea to give better money management ideas when they grow. Using simple methods depends on there age, you can easily bring them getting good understanding on money and can grow a habit of savings.
Below are some practical methods a parent can use to teach there kid about money and savings. Have a look:
Age group 1 to 7 – Give her a piggy bank and let her collect and deposit coins to that box. Regularly give coins to your kid for her piggy bank. This approach build a habit of small savings in the early ages.
When the piggy bank is full, open a savings bank account in parents name and deposit the amount to that account. Small drops can form a sea in the future.
Someone in my place starts this habit at the age of 2 and still he following at his present age of 43. The account his father opens for him still alive with enormous amount from his small deposits for long term and now he planned to teach this habit to his daughter and present this account to her.
Age group 7 to 10 – Give her awareness about savings bank account, how adding and removing money from savings accounts, how the money growing in it with interests etc… teaching her about interest calculations will do magic at this stage.
Take her to bank with you and let her learn how dealings are happening there. Give ideas to know more about bank transactions.
Age group 10 to 15 – Start a recurring deposit. Instruct to add a small fixed amount in each month. She can easily collect this amount from her pocket money and gifts. You can also give small amounts as gifts on there good work like well study, helping mother and father, cleaning house, gardening etc. Let her build very good awareness about systematic savings well as the hardworking nature to get awarded promptly.
Teach her on compound interest and the magic of compounding. It is very good in this age to know how compound interest works and how the amount increasing by its power.
Give practical knowledge on banking services like using ATM, cheque book, internet banking facilities etc.
Age group 15 to 18 – Give directions to get knowledge on various investment instruments available in the market. Teach her about mutual funds and how it is working, fixed deposits etc. Let her get awareness about various investment products and the difference of returns from these products and different risk levels related to each products.
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Money Lessons for Kids
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