1. Build your Credit Score
2. Reduce your Current Borrowing / EMI Costs
During our stints of parenting, we all face several difficulties in teaching and discussing different aspects of growth phases with our children. Conversations related to adolescence, career choice, money management, and imparting the values that we want our children to learn are undoubtedly difficult, yet these are the factors that play significant roles in shaping the lives and careers of the kids.
Teaching kids to save money should start from an early age, as you can't accomplish it in a day. However, the biggest question that arises is when would be the right time to teach kids about money? It is apparent that you can't talk about money with your kids before they are six years old as they won't understand; however, don't overthink! Start it as soon as they enter that age bracket. During this age, the grasping power of kids remain high, and they start understanding basic mathematics. But remember that financial literacy can be a boring subject for kids to learn, so you need to adopt a few smart and playful techniques to make them understand the nuances of money management. So here we are with seven easy ways of financial literacy for kids:
Since the time your kids start learning maths, teach them practically using coins. Coinciding finance with Math would be an interesting mode of teaching and children will adopt it quickly. It’s a great first step to initiate the learning process. You can also play field games with your kids to give them practical experiences of basic maths that we do in our daily life -- you can act as a shopkeeper, and they can be the buyers. Explain the simple calculations of addition and subtraction that are required in shopping. After a few sessions of shopping simulation at home, send your child out to face the real world either at a store in your society or at any nearby shopping mart. Ask them to make a list of items that you want, then allocate a certain amount and explicitly instruct them about sticking to the list. To motivate them further, tell them that the amount they will bring back will go into their piggy bank.
Take your kids for shopping and tell them what entails in your budget. Talk about the budget crunch and the exclusions; explain to them the reason behind it so that they may understand the significance of setting a budget. This way, they will also understand that their parents have certain limitations on their demands.
Start playing board games such as Monopoly, Business Owner, Payday and Career with your kids while they grow up and make them co-relate these games to real-life situations -- being business owners, how can they utilize their money for opening more companies; when does the payday come for an employee and what are the necessary components of the salary; how to make clever financial deals, etc.
The retail sector is getting more and more organized, leaving very little scope for negotiation during purchase. However, if you want your kids to learn to bargain, then send them to bring vegetables or fruits from the street hawkers. Ask them to check the price per kg before buying the items and then teach them to ask for discounts from the vendor on the asking price. It will be the first step towards learning negotiation. As the kids get into the habit of shopping often, they will get a rough idea about the market price of several items, based on which, negotiating with the hawkers for a better deal will become easier for them.