10 Ways To Teach Your Kid Financial Responsibility

Ministry of Education reintroduced cleaning activities to the curriculum.

Experts have said that it cultivates a sense of ownership in children. I fully agree.

School is a place where our kids learn many values.

However, the topic on money is often left for daddy and mummy to teach.

Imparting financial responsibility is essential and these are 10 quick tips. Read till end for bonus!

1) Be a great role model

You are the fundamental first step.

Your kid will observe and mimic your attitudes in many ways, including those relating to money.

Avoid using phrases like "We Can't Afford It".

Instead mention that "We choose not to spend our money that way". This highlights to them a sense of responsibility towards budgets.

2) Pay your kid for extra work

Create a “job board” in your house that includes tasks that go far beyond normal household chores along with a small reward for completing them. An example will be washing your car for $3.

Let your kid choose and earn a bit of additional spending money.

Firstly, this teaches them that work is worthwhile. S

econdly, with extra money given, there is more responsibility to manage money.

3. Not banking all the "ANG BAO MONEY" - especially for kids without pocket money now

We banked in all the $50 notes from Chinese New Year celebrations and deliberately left the $10 and $2 for him to keep in a private stash.

He is proud of it right now and we have taken out the money to play for quite a few times.

4. Set up a saving system - especially for kids with pocket money now

It is a good idea to compel your kid to save a certain amount of money.

Have a physical piggybank especially if your kid is young. Once your kid gets into the habit, he/she will likely start doing it automatically when older.

On the other hand, if you let he/she blow all the allowance, it may develop into a mind-set that rapid spending is normal.

You can even set up a matching savings goal with your kid.

5) Bring your kid to the bank and CPF with you

Bring your kid to a bank branch to show them how banking works.

Open a bank account with them and it is a great time to practice math.

For older children, show them to CPF and encourage them to ask questions.

Common question my sister got with her older kids was "how does interest work" and "why government sets up different saving accounts for citizens".

Share with me what questions you've gotten!

6) Bring your kid grocery shopping

I love going to supermarkets with my family.

Grocery shopping is a great time to talk about money because there are price labels everywhere and tempting offers at every corner.

Your kid will be tempted by treats not in your shopping list and it is a great opportunity to discuss with them what a need is and what a want is!

You can also show them how to determine value in your purchases.

7) Create opportunities to buy and sell with your child

If you want your child to develop some business sense, you can look at this point seriously.

I got this idea while reading on how the wealthy train their children.

You can buy any possession like "favourite card game"  that your child has and let he/she receive money as a form of "trade"

8) Talk about money regularly and casually in the family

Money should not be a taboo subject. Share with them how much you earn and what financial goals you have.

While you try to bring about money regularly, avoid negative associations with money like "money is the root of all evil" or "money is hard to earn".

This helps your child build the right associations with money.

One idea is to associate money earn with helping people. A hawker earns money by helping to make nice food. A dentist earns money helping someone with their toothache.

9. Let your kid plan some family budgets

The next step to allocating money is to teach them about budgets. A major issue for kids when it comes to financial literacy is understanding just how much things cost in “the real world.”

 We may have begged for a new toy or asked for a back-to-school shopping spree ourselves when we were younger. Let your kid know how much it costs to feed your family or keep a roof over your head.

10. Allow your kid to make mistakes

The great teacher's quintessential teaching tool: learning from mistakes!

Always a part of the students journeys and a time to learn. It is the same whether we’re talking about learning to ride a bike or learning to manage finances.

 Your kid may misplaced money or bought unnecessary things in this process but allow it to happen. Discuss with your spouse where to draw a line and this ties in with the previous point 8 “Talking about money regularly and casually”.

Bonus: Teach kid on donation

Singaporeans are more generous than I had imagined.

The survey by Asiaone some time back revealed that 83% of us have donated in one way or another.

While it is engrained in you to donate to the TV charity event or contribute to the student flag day on the streets, it isn’t yet for your kids. So how do you motivate them to give back to their communities?

There are a number of things that you can do with them to not only encourage them to give back but also understand the impact that they’re making.

Conclusion, delayed gratification is an important next lesson

Financial responsibility is important. A next lesson that woks hand in hand is delayed gratification.

It is learnt from deciding to do a bathe now and play games later. It is about eating up two business now or keeping one for tomorrow.

Last updated on June 6th, 2019 at 05:36 pm

The Astute Parent

A parent who has a sharp acumen on sieving through 'alien' financial jargon to dish out bite size financial tips from a parent's perspective.

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