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Useful Tips On Raising Financially Savvy Kids

According to Investopedia, financial literacy is the “ability to use knowledge and skills to make effective and informed money management decisions”. It is an area that is often skipped in the formative educational system. As parents, it is your job to fill in the gaps.

Educating your kids to make wise money decisions earlier on will affect their finances in the long run. Consider taking these financial steps:

CONVEY THE VALUE OF MONEY

Encourage your children to absorb the value of money by using tangible examples. For instance, you may employ counting games for toddlers. Grab a pack of M&M’S and have your kids sort each one by color. Let them count how many pieces are available per color.

Once they can discriminate, introduce them to the different denominations of Singaporean money. The difficulty level of your lessons shall increase with their ages. Older children learn best with realistic examples such as an educational trip to the nearby grocery.

Take a conscious effort in providing them information about money. And, be ready to answer their countless questions. Children are innately curious after all!

SET THE RULES ON ALLOWANCE

The idea of giving an allowance is something that many Asian parents embrace wholeheartedly. While it can be a controversial subject, some experts believe that children can learn how to handle their own money by having allowance. Begin by making weekly allotments and cutting it short to bi-weekly allotments for preteens. Limiting the allotments will help your child to continually be challenged. They must think of ways to make their allowance last longer.

The next step is creating a budget with your preteens and teens. Sit down with your older children and enumerate their streams of incomes and expenses. Highlight the importance of distinguishing between the needs and the wants.

OPEN A CHILDREN’S SAVINGS ACCOUNT

What better way to teach your kid about the value of savings than by opening his or her very first account? Children nowadays were blessed with technology. This means that they can simply review their account balances and transactions online. Watching their account decline over time can instill wiser spending choices. While, watching the account grow can motivate them to save more.

Dwell on are the essence of withdrawals and deposits as well as the safety procedures of online banking. There are several local children’s savings account such as ePOSBkids Account and OCBC Mighty Savers Programme. Both do not require a minimum deposit.

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Sources: 1 & 2

Setting Financial Boundaries With Dependent Relatives

It is alright to help your relative out of a one-time financial jam. However, if this person relies on you on a regular basis, his or her actions are indicative of financial abuse. Stand your ground by setting clear boundaries.

ACCEPT YOUR EMOTIONS

Honesty plays a crucial part in establishing financial boundaries. Begin by identifying the family members who frequently ask you for money. Examine how you really feel about their requests. There are several emotions that you can experience such as frustration and guilt. These emotions can overshadow your judgment of the situation.

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Regardless of what happened in the past, it is time to make a stand for the future of your finances. Do so by addressing your own negative and positive emotions first.

CONVEY YOUR FINANCIAL PHILOSOPHY

When understanding your financial philosophy, include your personality and lifestyle. Communicate this said philosophy when the dependent relative borrows money. Are you a person who values helping others in ways that do not involve money? As long as you bring your relatives back on their feet, I respect your decision.

Discussing your monetary views is uncomfortable. But, it is something that you must work on. You may take the subtle route by saying: “I wish I could help, but my finances are not allowing me to do that at the moment.” To take the direct route, say: “No! I do not believe in wasting my hard-earned money on that.”

LEARN TO BE A FAIR NEGOTIATOR

Let me send a wake-up call to you! Avoid feeling pressured to signing a contract or loaning cash just because the other party is your relative. Whether there are two or more people involved in the decision, negotiating is important if all the parties are to succeed.

Highlight what you are willing and not willing to do with your finances. While these people may have good intentions, you need to be fair to yourself and your finances.

PUT EVERYTHING IN WRITING

Cultivate a habit of having your financial agreements in writing. Protect yourself against legal issues by getting your deals, offers, and other financial agreements in writing. People who respect you and your financial boundaries will not have a problem with this.

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When family members are involved, money is usually tangled with issues. It is up to you to deal with these issues by setting clear boundaries. Feel free to share the positive and negative ways that money has been used in your family.

Sources: 1 & 2

Do Not Tell These Money Statements To Your Kids

There are some financial issues and information that you shall just keep to yourself.

1. “Your Dad makes more money.”

In a dual-career household, you shall refrain from pointing out which parent earns more than the other. Putting a distinct label on the breadwinner signifies that one’s contribution is more important than the other. It is better to highlight that the two of you work as a team in order to cultivate a brighter future.

2. “Your uncle owes us S$5,000.”

You may be infuriated that your brother has not paid his debt. Sure! S$5,000 is a decent amount of money, but you shall not get your children involved in this issue. Children usually mirror the reactions and emotions of their parents. Telling your daughter that her uncle owes you money may ignite hatred or uncomfortable feelings toward him.

It is an admirable thing to warn your children about the risks of lending money. However, you must use an example that is too close to home.

3. “I spent a lot of money for your gift.”

Most children do not mind the cost of your gift. They simply want to relish the excitement that the act of receiving brings. To an innocent child, there is no difference between a bespoke and a store-bought cake. It is still a sweet dessert!

Putting a price on a gift (i.e., high/low or cheap/expensive) can just change their perceptions. Teach your children that the value of the gift is not always reflected on its price tag.

4. “I am broke.”

Have you ever noticed that some of our adult conversations are exaggerated? Children are less likely to absorb our subtleties in communication. Imagine you uttered these words: “I am broke.” Your young offspring may misunderstand what you just said due to your choice of words. Avoid declarations of financial disaster.

Instead, it is important to give your children reassuring messages. You may say that you have to wait a week until the pay day comes.

5.”Do not tell your Daddy/Mommy that I bought this.”

Your devotion to your spouse does not stop after having kids. Make it a point to discuss about your spending habits and future goals. If you are about to purchase something that you want to conceal for now (e.g., a surprise birthday present), do it at your own time. Do not use the vulnerability of a child as an escape.

If you encourage a child to lie to the other parent, it increases the likelihood of dishonesty. It sends a message that spending money is merely a shameful act. All these wrong signals can be prevented by you.

6. “I dislike going to work.”

No matter how tired you are of answering demanding calls or how much you hate your boss, you shall not verbalize these thoughts when your child is around. Complaining about these negative aspects of the job can make your child feel anxious about the future.

Opt for sharing the aspects that you enjoy the most about your job. What makes your work fulfilling and interesting? Dwell on that. Save the serious talk until she or he reaches maturity.

7. “We cannot afford to buy that.”

After spending a few hundreds on the grocery store, it can be confusing to tell your child that you cannot afford to purchase a toy. He or she may think that you spent all your money on groceries or that you have no more money for the important things. Turn this situation around by teaching your children about the importance of prioritizing and delayed gratification.

You may say something along these lines: “Please put that toy back. We do not need it right now. If you really want to buy it, you have to save up for it. I can help you!”

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As with most aspects of parenting, it is best to lead as a positive example to your children. Choose your words wisely.

Sources: 1 & 2

Surefire Ways To Nurture Your Child’s Marketing Abilities

The core of your business’ success relies on its marketing. Teach your beloved ones the marketing skills that they needs to thrive throughout their lives!

Do so while you have the luxury of time.

WATCH COMMERCIALS AND OTHER ADS

Children do not have the capacity to carry a stable job nor do they have the ability to budget money. However, they can influence how you spend it. Savvy marketers know this! For instance, expensive products for kids are usually placed in lower rack to meet their eye level. Television marketers focus on producing more content for toys, candies, computers, and so on.

Commit at least once a week to introduce the potent effect of advertising to your suggestible children. Select some commercials or ads to ask the following questions:

a. WHO was the intended audience?
b. WHAT was the description of the product or service?
c. WHY was the ad placed during or between this show?
d. HOW did you feel about the commercial or ad?

KNOW DIFFERENCE FROM REALITY AND FANTASY

Aside from discussing the detailed content of the commercials and other ads, you must create a distinction between reality and make-belief. It is easy to be trapped into the advertiser’s magic, if you do not know what to watch out for. Tell your children that there is more to advertisements than what meets the eye.

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Discuss the various types of commercials on radio, television, print, and online. Help your children label these said ads so that they become less susceptible to the marketers’ influence.

CREATE CATCHY SLOGANS AND TUNES

Your dedication has led your children to understand the effect of advertisements. To absorb the essential marketing abilities, allow them to make their own catchy slogans and jingles. These activities will help the potential entrepreneurs to use their resources to create significant marketing tools that will make a particular product rise above the pack.

Without valuable customers, even the best businesses will fail. Introducing this topic to your children can prepare them to attract loyal customers for their future businesses.

TRANSFORM THE OLD INTO THE NEW

As you may notice, existing brands are constantly thinking of ways to improve their products and to satisfy their loyal customers. The longstanding OREO boasts with a variety of unique flavors such as Banana Split and Birthday Cake.

Ask your child to apply this idea by putting his or her own spin into a popular product. This activity is a good way to maximize his or her own creativity as marketing heavily depends on innovation.

Image Credits: pixabay.com

Sources: 1, 2, & 3

Surefire Ways To Waste Your Money As A Parent

Many parents, including my own, are guilty of spoiling their children with affection and attention. They spend money on the things that would make their child happy. Do not get me wrong! This is a normal reaction. However, excessively giving in to these impulses can lead to serious monetary consequences.

Awareness is the first step!

Repair your spending habits by knowing the “Four Ways To Waste Money As A Parent”:

ELECTRONIC ENTERTAINMENT

Back when I was a child, coloring books and sticker albums were all the rage. My friends and I used to compare each other’s collections and artworks. Let us fast forward to the present age. The children of today are utterly obsessed with Smartphone apps and video game consoles. Downloading no-cost gaming apps are okay, but its extras come with costly price-tags. Furthermore, the unit upgrades of video game consoles are insanely rapid.

For instance, the Xbox One may potentially be the last generational console from Microsoft. The renowned brand is looking forward to re-imagining consoles by combining its features with a Windows-operated PC.

DESIGNER CLOTHING FOR CHILDREN

Children can have sudden growth spurts. Thus, it is unnecessary to purchase loads of baby or toddler clothes. This holds true for shoes and socks as well. Instead, you may ask your friends and family members if they still have their kid’s outgrown clothes.

A kid’s wardrobe is both temporary and cluttered. This is why you must not purchase designer or boutique apparel.

SPECIAL BATHROOM PRODUCTS

The people behind children’s bathroom products lure you with the vibrant array of cartoon characters in their packaging. Barbie bath bombs and Angry Birds toothpaste sounds attractive in theory. However, they may contain chemicals that are harmful to your beloved child. Look at the ingredients rather than focusing on the pictures.

If you really care for the well-being of your child, you will take care of his or her health first.

INFANT FORMULA

Breastfeeding is among the most empowering gifts that women can offer to their babies. As much as you can, opt for breastfeeding because it will not only be healthy but also be able to save you as low as S$1,500 per year.

You may also borrow a breast pump from your friends or family members, but ensure that you change the plastic attachments. You can buy those for far less than a brand new pump.

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Whether you want to throw an extravagant birthday party or to purchase a domestic pet for your child, there are different ways to flush your money down the drain. It is time to make better choices for your family and your finances!

Sources: 1 & 2

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