There is nothing quite like the feeling of receiving your first pay cheque. However, with the minimum working age in Australia between 13-15 years old, without the proper guidance, the temptation of spending down to the last dollar can often win over logic or good habits.
Recent research reveals that over a third (37%) of Australians want to set their children up with good financial habits. To assist in this endeavour, Chillur has prepared the top tips to help your children learn good money habits. These five lessons will teach your kids how to responsibly handle their money now and for the years to come.
Learning to Earn
The ultimate financial habit to teach your kids is how to earn. Without any money coming in, there is no money to handle. Teaching your kids to go out and earn, whether it’s from washing the family car or mowing the neighbour’s lawn, will teach your kids to be independent and responsible. This lesson will instill the value of money into your kids that will stay with them for the rest of their lives and hopefully stop them from begging you to buy them something at the store.
Stick to a Budget
When they first see the money in their birthday card or their first wage in their bank account, it can be hard for kids to not burn a hole in their pockets. Helping your kid set up a budget will teach them how to handle their money responsibly and make sure they don’t spend it all in one go. By teaching them to track their money going in and out, you will show them where their money really is going and help them prioritise their financial goals. Budgeting skills will follow your kids into their teens and adulthood when their expenses will grow and help them work for their financial stability.
Straight into the Piggy bank
From a simple piggy bank to a savings account and beyond, a great way to teach kids financial habits is to get them saving. Whether it’s their pocket money or hard-earned wages from their first job, your kids can start saving at any age. The sense of achievement and accomplishment that comes from watching your money grow is a powerful habit to create.
Investing is the name of the game
The best way to teach your kids the value of financial responsibility is to show, not tell. By investing in your kid’s name, you can set them up for investment rewards when they are older and showcase the benefits of long-term investing. The years of building up their portfolio will ensure that you have a strong investment to give them and show them the power of investing. A great platform for beginner investors is Chillur, it allows for Aussies to invest in cryptocurrency starting from as little as $5 to build their long-term wealth.
Responsibility = rewards
After all your efforts as a parent to teach them to save, budget, and invest, the key lesson that your kids will learn is that financial responsibility equals rewards. The hours they spend earning money and their restraint and dedication to budget, save, and invest it will all pay off and teach them the value of responsible money decisions. The rewards that they reap from their hard work will spark their continued effort in the future to maintain their financial success.
As a parent, laying down the foundations for a bright financial future will always be a benefit. Creating those healthy habits early will follow them to any future decision be it cars or mortgages, and help shape them into responsible savers and investors. We’re not suggesting you run a crash course on what a mortgage is, but instead show them to the path that could lead to one.
DISCLAIMER: The information in this article is intended to be general in nature and is not personal financial product advice. It does not take into account your objectives, financial situation or needs.