Money management is an important skill. People of all ages often find themselves in need of additional training and education in this matter, but the best place to begin learning is childhood. Studies show that children who learn good money management skills in childhood are better at saving and investing later in life.
Learning to Save
The first step in providing saving opportunities for your children is providing an earning opportunity. When kids learn how to make money instead of being given money as a gift or reward, they are more likely to value it properly. Give your children an allowance or base the amount they can make on chores completed or good behavior.
Next, talk to your kids about what they need vs. what they want. Actual needs should be provided by the parents or guardians, but prioritizing the things your child wants to use their money for will help them create savings goals.
Facilitating Saving for Children
Once your children understand how earning and saving works, it’s time to help them put it into practice. Give them a dedicated place to put their money, like a piggy bank or an envelope system for older children. A central location will allow them to keep track of where their money is and how it’s being used. The best way to save money is a container that allows for easy containment and removal of funds, so children can learn self-control. If they can take their money out at any time, they will be given a better opportunity to learn why they shouldn’t.
Be sure to also teach your children how to track their savings, spending, and other use of their money. Keeping a checkbook-like record isn’t necessary, but even the youngest children can benefit from tracking what they have and what they’ve used. This will allow kids to make smart decisions about how to use their money.
Money Management Education for Foster Children
Learning valuable life skills like money management is especially important for children in foster care and similar situations. It’s common for foster care organizations to partner with charity organizations for children like the Arizona Friends of Foster Care Foundation to provide education and skill-building opportunities in these areas. This helps to prepare children for a successful life, whether they begin adulthood by leaving the foster system or their family home. For more information and to learn how to donate to support these programs, contact us at AFFCF today!