Money Doesn’t Grow on Trees

Read our tips on how to teach your children the value of money.

There has been a tremendous boom in the marketing world, quite different from when we were children. Ads and campaigns that lure kids into buying endless kinds of products are everywhere. Protecting our children from marketing propagandas and teaching them how to spend wisely are important issues parents should think about.

1) Explain where money comes from
It's essential for children to know that their parents work hard for the money that they earn. They need to know that the ATM machine doesn't eject money from oblivion. Explain to them that when you deduct money from your account, it's gone until you earn the money that you'll get at the beginning of the month.

2) Be a positive role model
Spend money in front of your kids in a responsible manner and always explain to them why you preferred to buy a particular item instead of another. Children must also learn that money has to be spent carefully, so that they don't end up spending too much on unnecessary items. This will help instill your own money values in your child. Also, don't talk about dreaming of having a particular product because this will just reinforce the concept that material objects are what make us live happily.

3) Explain the aim of ads
When your child is old enough (around six), you can explain to him the aim of advertising and marketing strategies. For example, explain to your children that the fliers that are constantly sent in newspapers offering toys with junk food combo meals are just a way to lure us into buying more and more unhealthy meals. Also, explain to them that some of these toys are of poor quality. Even if you can't convince your children the first time you talk to them, they will store the information in their minds and this kind of guidance will help them manage money more wisely when they are older.

4) Set a small allowance for your child

What better way to teach your children about money than to actually let them experience spending? Give them a small daily allowance. When you go shopping tell them to bring their own money with them, and when they don't have enough money for a particular item, advise them to save some more so that next time they can buy what they want. Under all circumstances, don't give in to their pleading for you to buy the item for them because this will just defeat the purpose.
Expect some unwise purchasing in the beginning. Developing the correct "money sense" does not come overnight. It takes experience to figure out that it would have been better if they hadn't invested in a particular item. Remember to discuss your children's mistakes with them without being too critical.
5) Family meetings teach money management skills

Experts believe that scheduling a time for the whole family to discuss their needs and wants helps train kids to fulfill their needs using resources available. The main benefit of these meetings is for your children to learn how to manage the family's income and to learn about priorities.

6) Highlight the importance of nonmaterialistic values

* We must not forget to teach our kids that the best things in life are free!

* If your child makes you a Mother's Day card, praise it as if it were an expensive present. l *Talk about the fun things they do with their grandparents and not just the toys their grandparents give them.

* Show them that they can spend their money on charity, and how gratifying that can be. They will learn that helping others can be even more enjoyable than spending money on themselves.

7) Encourage your children to earn privileges

Kids take many things for granted such as watching TV endlessly, playing with computer and electronic games, or going on special outings and trips. Encourage them to earn such privileges by getting tokens for work done, helpfulness, obedience, and participation in certain activities. In other words, instead of allowing your child to watch TV for an hour or so unconditionally, extra TV time is earned in exchange for a particular number of tokens. A more costly outing is the compensation for having a greater number of tokens. This concept of exchanging tokens for extra privileges makes a child develop a sense of responsibility, and eventually helps him realize that things must be earned. The idea of money being important to obtain a privilege and that it has to be earned is a value that makes it easier later on for a child to appreciate the fact that money does not grow on trees.