The concept of money is a fundamental skill that any adult, parent, guardian or family member can help teach their young ones, according to Carla Oberholzer, a debt advisor at DebtSafe.
Oberholzer encourages adults to start raising a generation of youth that are money savvy.
“Now is a good a time as any to start with the empowerment process – grown-ups need to start talking to kids about money, make the money concept tangible and help the youth to become financially literate,” Oberholzer said.
Here is an age-by-age guide on how adults can teach children and youth financial lessons:
Toddlers: 2-3 years
Adults can introduce financial concepts through creative learning and 'make pretend' fun.
Toddlers can be taught the different names of coins (cents) and notes (Rand), or play a colour game and let the children get familiar with money. Make sure that the there is adult supervision when playing with fake/real money, especially with coins.
You can also play ‘shopping at home’ so kids understand the basics of ‘business’ by exchanging money for goods.
Preschoolers: 3-5 years
Adults can encourage their 3 to 5-year-olds to participate in money savvy teachings and activities.
Children and their parents can take part in imaginary play initiatives like ‘restaurant’ or ‘grocery shop’ so kids can learn skills such as good manners and making change as the cashier.
Oberholzer said, “Doing chores for pocket money offers educational moments.”
Parents can also teach their kids the concept of saving with the use of a piggy bank.
Gradeschoolers: 6-12 years
Now is the time that you teach your kids about money awareness.
You can open a bank account for your child. Many South African banks offer bank accounts that have a zero service fee and offer rewards for children.
“Parents can try comparison shopping with their kids that can be educational shopping outings to spot discounts and compare generic versus brand-name products’ prices.”
Teenagers: 12-18 years
It is the time to teach your kids the value of budgeting and the gift of giving.
Parents can help their children set up a budget and explain the difference between 'a want’ and ‘a need’ so they are not spending all of their money at once.
Programmes such as ‘MoneyTime’ or ‘StarSaver’ can assist parents in teaching various financial skills.
Oberholzer said that there is nothing better to explain the concept of money than by also giving to charity, and adults can let their children choose organisations they would like to contribute to.
“A financial lesson via a social responsibility initiative offers teachable moments and is a long-term ‘money behaviour’ investment for any teenager.”
Young adults: 18-30 years
Young adults need to consider the following financial lessons:
– the importance of budgeting
– a clear understanding of the difference between 'needs' versus 'wants.
– if they are working, start small when taking out credit/debt – there is no need to buy a house and a car all at the same time.
– get advice on medical and financial products including an emergency fund or a retirement annuity
– keep eye on debt
– have a plan to incorporate short-term or long-term goals and savings into their budget.
IOL Business